How Was I to Know?

In January 2020, I invested 150K I had inherited from my parents from the sale of their house. I knew it would be years before I would tap this money, so I invested in Vanguard’s intermediate bond fund in my brokerage account. I had learned that bonds were a safer investment than stocks and I could earn a somewhat higher return than in CDs that were paying next to nothing in interest. By September of ‘21 I was looking like a genius as I had earned 10K. But then came the bond crash and by April of ‘24 I had lost 6K. Now, after 5 1/2 years of investing these funds, I have gained a whopping 4K, a 0.5% gain.

I just read in a Morningstar that, in the past 150 years, there have been only 3 bond bear markets, and of course we know the last one was THE worst in history of the bond markets.

I was trying to be a responsible investor with the cash portion of my inheritance, but how was I to know we would face the worst bond market in history?

Oh well, c’est la vie!

At least overall I haven’t lost any of the money.

P.S. This year I “cut my losses” and took a 21K  capital loss and reinvested the money in a short term bond fund as we are hoping to spend some on a new porch. However if the tariffs on Canadian lumber go through that dream may become a financial nightmare.

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