Article originally published by Forbes.com
written by Mike Patton
“When panic struck in 2008 investors sold stocks and rushed into bonds with great exuberance. Over the past five years this extreme cash influx has pushed bond prices higher and yields lower. However, when investors began to sell stocks recently, if the proceeds would have flowed into bonds, then one might have expected bond prices would have risen and yields would have fallen, or at least remained low. In reality, this has not been the case as we have witnessed one of the sharpest and quickest increases in bond yields in decades. Therefore, if you are invested in bonds your concern should be the degree to which bond values will fall if interest rates continue their ascent. In this article, we will address this very important point.
Background
“Over the past 30 years bonds have been in a bull market. This is partly because in October 1981 the U.S. 10 Year Treasury peaked at over 15% and has been on a steady decline since then. To explain, let’s assume you invested $10,000 in a 15%, 30 year bond back then. By midyear 1995 rates had fallen to around 6%. Because bonds have a market value like other investments investors interested in buying your bond would have paid a higher price because it offered a superior yield. Hence, if interest rates decline after you purchase a bond, generally speaking, the value of your “higher yielding” bond would rise. Of course, the reverse is also true.”
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Amy Anderson joined the ILG Financial team in 2023 as the client relations coordinator. Her responsibilities include scheduling of appointments, annual check-up notifications, and annuity and required minimum distribution assistance. She is a graduate of Harding University with a degree in Computer Information Systems. Amy and her husband have two children and she enjoys reading, crocheting, music and spending time with her family.
Chase Lopez joined the ILG Financial team in 2020 as an advisor. Chase is a 2016 James Madison University graduate with a degree in management. Chase has been trained under the tutelage of Dave Lopez, who is not only the founder and managing member of ILG Financial, but also is Chase’s uncle and godfather. He also enjoys working alongside his cousin, Megan, who is Dave’s daughter. Chase, as a fiduciary, believes in putting his clients interests first, and building out plans for his clients where they can have a happy and fruitful retirement. He married his beautiful wife in February 2022 and both use most of their free time chasing around their little pup, Aurora.
Jessica Carson joined the ILG Financial team in 2018 as an agent. Jessica and her husband have four children, two dogs, 3 barn cats, 5 chickens, and three parakeets. She indeed loves her children and pets! When not at work, Jessica enjoys playing the piano and cello as well as traveling and spending time outside with her family, hiking, fishing, and boating.
Terri Center joined the ILG Financial team in 2019 as client services manager. She handles client records, application processing, and gathering information to provide a professional and friendly experience with all of our clients. Terri is a graduate of Oakland University. She is married and has two children. She enjoys hiking, family time, and puzzle challenging video games. She also likes to share her creativity in her canvas paintings and sewing projects.
Megan Jones joined the ILG Financial team in 2020 as marketing director. Megan and her husband live in Fredericksburg, VA with their German Short Haired Pointer, Gus. Megan is a graduate of Longwood University and holds a degree in communications. Megan is the oldest of Dave Lopez’s three children and not only enjoys working alongside her father, but also with her cousin, Chase, who joined the ILG Financial team in 2020 as an advisor. When not at work, Megan enjoys sitting on the back porch with family and friends enjoying food and music.