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Bonds are a type of investment that allows you to make a loan to a company or government. When the bond matures, it pays back your original investment plus interest. Bonds typically have terms from one year up to 30 years. They're considered safer than stocks because they offer more stability and less risk of loss in value as well as higher yields due to their fixed income payments.

Bonds can be used for retirement savings by purchasing individual bonds or mutual funds that invest in many bonds at once with different maturities and credit quality ratings so there is diversification within the portfolio, which reduces risk even further. By investing in bonds, you can potentially earn more than individual stocks and diversify your portfolio without having to be educated on the stock market.

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