Get out of debt 

Financial Terms and Glossary

Definition of Bonds

Personal Finance Terms Home

Bonds are debt issued by corporations or governments or other institutions. Bonds typically pay a given interest rate over a specific time period. The original principal is repaid by the bond issuer at the end of the period, or when the bond matures.

There are all types of bonds available. Buying and selling bonds is often more complicated than buying and selling a stock or a mutual fund. It's good to have an understanding of how this works or, maybe better, to have your financial advisor or broker handle this for you.

Some government bonds or municipal bonds offer significant tax breaks over corporate bonds, however, this may or may not be to an investors advantage. Often corporate bonds pay at a higher interest rate that more than offsets the tax advantage.

Bonds often come with varying risks. Some corporations will issue bonds at a very high interest rate to raise capital. These bonds will usually have a higher risk associated with the higher interest rate.

Personal Finance Terms


Download Free Budget Tracker Software


  • Assets
  • Balance Sheet
  • Bankruptcy
  • 401k Plan
  • Bonds
  • Debt
  • Debt Consolidation
  • Interest
  • Mortgage
  • Mutual Funds
  • Retirement Plan
  • Stock

    Other Info

    Organize Your Life

    Organizer Software

    Free Finance Shareware Software


  • This site is Copyright TSI 2004-2012, All Rights Reserved  Terms of Use and Privacy Policy