What to Look for in a Bond

5 basic rules when investing in bonds:

1. Look for bonds first being issued, as the issuer pays the sales commissions on new issues.
   
   
2. Look for high-quality bonds, rated in the “A” range by Standard & Poor’s or Moody’s Investor Services.
   
   
3. Avoid bonds that have a higher chance of being called before the maturity date.
   
   
4. Avoid selling your bond on the secondary market--aim to keep it until maturity.
   
   
5. If you do plan to sell your bonds before they mature, select those with good resale opportunities, such as bonds issued by larger corporations and/or municipalities.

Source: The Wall Street Journal Lifetime Guide to Money