Is a bond ladder better than a bond fund?
Question: During retirement when one is withdrawing funds from a portfolio, which is more appropriate as a distinct asset category, bond funds or a bond “ladder”?
Gordon’s answer: Each has its own advantages. A good bond fund offers a well-diversified portfolio and regular distributions, usually monthly or quarterly.
However, bond funds can be expensive because of the management expense ratios (MERs), depending on which one you buy. The Phillips, Hager & North Bond Fund, which is one I have owned and recommended for years, has an annual MER of 0.6 per cent, which is very cheap.