I recently wrote about my intention to move some of my retirement nest egg into a defined maturity bond fund. I thought this initial investment would be inside by 401k plan. Instead, I used cash that had been sitting in my taxable retirement investment account after I sold my gold ETF holdings earlier this year.
Currently, IBME has a distribution yield of 0.71% which equates to a tax equivalent yield of 1.25%. This is in the range of what two-year CDs are paying. However, I prefer the flexibility of an ETF. I can move out of it in a matter of minutes if I so desire, commission free and with no penalty.
I am still looking at making some moves inside my 401k to provide further protection against market declines that will follow the inevitable Fed action to increase interest rates. I am in a good place right now with my nest egg and I don’t want to do anything stupid or allow an irrational market to do something stupid to me.