Thursday, 23 January 2014 17:33 admin
Mitchell Reiner, partner at Wela Strategies, was recently interviewed by Fidelity and shared some insight about what individuals can do to boost their retirement income right away. Whether retiring in the immediate future or ten to twenty years from now, consider the advice Reiner shares.
Most analysts don’t expect yields to climb as steeply this year; the Federal Reserve would likely prevent it. But yields aren’t likely to fall much, and the 10-year Treasury could edge up to the 3.5% range if the economy continues to strengthen.
“We think bonds will be less bad in 2014, but they’ll still see some pressure,” says Mitchell Reiner.
Using ETFs, Reiner suggests the following “yield-plus” portfolio for investors looking to enhance their fixed-income returns:
The portfolio has a targeted yield of 5% to 7%, Reiner says, and should outperform traditional bonds if rates keep rising. It should be rebalanced periodically to maintain the investment mix, he adds.
Key risks: The portfolio could lose money if rates spike or there’s another financial crisis. It’s likely to be more volatile than a conventional bond portfolio.