O - Retirement: Why REITs Are Good Bond Replacements

Investors have historically relied on bonds (LQD, VCLT, IEF) to generate consistent and safe income in retirement. While this may have worked well in the past, today's environment is much less favorable to bond investors.

After a multi-decade-long decline in interest rates, the yields are now at exceptionally low levels:

source

This creates two major issues to retirees:

• Not enough income is earned to meet their retirement needs.
• The value of their bond holdings may erode if and when interest rates return to normal and inflation accelerates.

What is then the