Should I keep my bonds?

[questions]

My broker has advised me to keep my government bonds (Fannie Mae). Do you think this is good advice? Thanks for helping.

[disneysteve]

Good question. I asked the same question not long ago. Here is a link to that thread.http://www.savingadvice.com/forums/i...mae-bonds.html

It did only get one response, though. I don't think many (or any) of the regulars here invest in these.

By the way, these are NOT government bonds technically.

[glock35ipsc]

**Edit - My original post made no sense!!

Freddie Mac/Fannie Mae bonds would be considered mortgaged-backed securities.

[simpletron]

I'm going to reiteraite my position that fannie mae bonds are fairly safe(nothing is truely safe in my mind not even short term US treasuries and FDIC insured accounts) and that you will probably get all your money plus whatever interest you are suppose to get.

but the question of should you keep them or not is more complex. this depends on your many factors like:
1. your risk tolerance
2. your investment goals with this money
3. what interest rate you are getting versus what you could somewhere else(you can get 3.5%+ in FDIC insured accounts, so if you aren't getting that, you might considered selling)

without addition information, I can't tell you if you should keep them or not.

how does your advisor make money? does the advisor have an interest in you keeping the bonds? I ask these question because if your advisor gets paid a commission every time you sell or buy something, then they just turn down money which makes me believe that you should keep the bonds. if you advisor is paid a percentage of your total holdings every year then there might be a conflict of interest and your advisor might be giving you bad advice, so they can make more money. if the advisor is yearly fee-only then they generally give unbais advice or they could be just lazy.

in the end, you should invest in what will let you sleep at night, no matter what your advisor says.

note: i do not own any bonds other than US I-bonds, but I do own some shares of fannie mae.

[mrpaseo]

I don't know much about these funds but in common practice if you rode the roller coaster down with these, take your time and ride back out of the bottom. (Unless you think they might go under all together).

Just my two pfenning,
Ray

[responduser]

My broker has advised me to keep my government bonds (Fannie Mae). Do you think this is good advice? Thanks for helping.

Ask your broker the reason of why he is saying so. If he is giving valid reasons, then do accordingly otherwise do whatever you think is suitable for you.

[disneysteve]

My mom's broker gave the same advice - keep the bonds. There really doesn't seem to be any significant concern that these bonds could default. Considering that Fannie Mae and Freddie Mac hold 50% or more of all mortgages in this country, a default would have catastrophic effects on the economy and the government isn't about to let that happen.

[cipixul]

I would have to agree to keep the bonds if you don't have an alternative...