With Ultra-Low Rates, Should You Still Invest in Bonds?

If you’ve been investing for many years and you’ve owned bonds, you’ve seen some pretty big changes on your financial statements. In 2000, the average yield on a 10-year U.S. Treasury security was about 6percent; in 2010, it had dropped to slightly over 3percent , and for most of 2020, it was less than 1percent . That’s an enormous difference, and it may lead you to this question: With yields so low on bonds, why should you even consider them?

Of course, while the 10-year Treasury note is an important benchmark, it doesn’t represent the returns on any bonds you could purchase. Typically, longe...