Why Bonds and Fixed Interest Deserve a Spot in Your Portfolio (Even if you think they’re boring)
Let’s be honest, when you think about investing, you probably picture shares, ETFs, maybe even a little crypto if you’re feeling spicy. But bonds? Fixed interest? They sound like something your grandpa would talk about while checking the weather forecast.
But here’s the truth: boring doesn’t mean bad. In fact, when it comes to building a well-rounded, grown-up, financially savvy portfolio, fixed interest is kind of a big deal.
Here’s why you should care and how bonds can actually help you get ahead.
💸 1. They bring calm to the chaos
Markets go up, down, sideways and sometimes, all in the same week. If your entire portfolio is riding the share market rollercoaster, it can feel like a bit of a financial emotional whiplash.
This is where fixed interest investments (like bonds and term deposits) shine. They’re generally lower risk and don’t tend to swing wildly with the share market.
Translation: they help balance things out when everything else feels a bit… unhinged.
🧘♀️ Fixed interest = the chill friend who doesn’t freak out when things get messy.
💼 2. They give you income (without doing anything)
One of the best things about bonds? They literally pay you just for owning them. They offer regular interest payments (also called coupons), so you’re getting a steady stream of income even if the share market is having a meltdown.
And if you’re saving for a goal or just want more predictability in your money plan? Fixed interest can give you exactly that.
💰 That’s passive income, baby.
🎯 3. They help you build a more balanced portfolio
Investing isn’t about throwing all your cash into the hottest stock and hoping for the best. It’s about building a portfolio that works for you one that can grow over time but also handle the bumps along the way.
Including bonds or fixed interest is one way to reduce risk and create a little financial cushion for the unexpected.
Think of it as wearing a seatbelt while you speed toward your goals. Safety and style.
📉 4. They react differently to interest rates
Bonds and interest rates have a complicated relationship. Without going full finance nerd: when interest rates go down, bond prices go up. When interest rates go up, bond returns can be more attractive.
This means fixed interest investments can actually be strategic. Smart investors don’t ignore them they use them to respond to what’s happening in the economy.
📈 TLDR: Bonds aren’t basic. They’re tactical.
🧠 5. They help you manage risk
This one’s important. As you get closer to needing your money like for a house deposit, travel fund, or even future-you’s retirement you probably want to protect it, not gamble it.
Bonds and fixed interest investments tend to be more stable and predictable, making them a great option when you're playing defence instead of offence.
💅 Risk management is self-care.
So, should you ditch shares and go all-in on bonds?
Nope. Not what we’re saying at all.
But bonds and fixed interest can (and probably should) play a role in your investing strategy — especially if you’re aiming for that long-term wealth building we’re always talking about.
Let’s wrap it up: Why we love a little fixed interest energy
✔️ They reduce the drama in your portfolio
✔️ They pay you regular income
✔️ They help balance risk
✔️ They’re perfect for short- or medium-term goals
✔️ They make you feel like a grown-up investor (because you are)
Whether you’re brand new to investing or levelling up your strategy, don’t sleep on bonds and fixed interest. They might not be sexy, but they’re seriously effective.
✨ Ready to go deeper?
If this chat about bonds and fixed interest has you curious about investing, we’ve got you. At She’s on the Money, we make investing feel clear, doable, and completely judgement-free. Whether you’re starting from scratch or levelling up your strategy, our Investing Masterclass breaks it all down in plain English so you can take confident steps toward building wealth that fits your life.
Want to dip your toe in first? Our podcast deep dives and free community resources are full of practical tips to help you feel cash confident. Because future you deserves to feel secure, savvy, and totally in control.
***Please remember our blogs aren’t intended as financial advice - they’re intended only as a starting point to give you a little extra info! For more in-depth advice catered to your personal financial position, please see a certified financial advisor.
