Personal Finance Buzz

A diversified portfolio contains both stocks and bonds. Even very young investors should own bonds.

Have you ever wanted to start your own business? Have you ever wanted to try your own hand at investing in stocks and bonds? Do you want to go backpacking through Europe after you graduate college? Do you want to join the Peace Corps? The time to take these kinds of chances is when you are young.

Even though stocks have historically been the best-performing asset class over the long haul, there's a solid case to be made for keeping at least a small amount of bonds in your portfolio regardless of how high your risk tolerance is.

What is a bond? Bonds typically move inversely to stocks. If stocks are down, bonds will be up. During stock market weakness, bonds will lessen portfolio damage.

Early retirees have different investing requirements and goals than most other people. Too little income and you'll have to go back to work, but too much risk and you could lose it all. Just how should a young retiree invest?

Want to know how to use junk bonds in your portfolio? Junk bonds are bonds issued by companies whom the ratings agencies have deemed a credit risk.

Bonds get none of the glory stocks get in the news but bonds are an important financial instrument that are a part of most balanced portfolios.