According to Fidelity, the number of 401(k) millionaires recently hit a new record.

Not coincidentally, the US stock market, as measured by the S&P 500, is also at an all-time high. If you have participated in this prosperity, I congratulate you.

If you’ve seen your retirement savings blossom and you’re nearing retirement, investing in bonds is an increasingly good idea. That’s because the closer you are to retirement, the more difficult it becomes to replace lost retirement assets with future savings.

The cold, hard reality is: You never know when the next big stock market selloff is going to happen. The good news is that understanding the benefits and risks of owning bonds and the role they can play in your retirement portfolio can help make your retirement savings more secure as you approach retirement.

A good way to understand the risk and reward of owning bonds is to compare them to stocks. While both are financial assets issued by a corporation or government, purchasing a share of stock means taking an ownership interest, while buying a bond means making a loan to a company or government entity.

Over the past 60 years, stocks have averaged an annual return of 10.7%, while bonds have averaged a 5.8% return as measured by the 10-year Treasury. Over the same time period, risk or volatility was on average about 60% higher holding stocks, with a “worst case” drop of about 50% for stocks compared to a 15% reduction for bonds.

Like any asset, your expected future return depends in part on what you pay. From that perspective, the stock looks pretty expensive, trading at 21½ times forward earnings, which is more expensive than it has been 91% of the time over the past 20 years. The bonds are yielding about 4% as measured by the 10-year Treasury, which is higher than 84% of the time over the past two decades. While stocks can certainly rise for various reasons, allocating more assets to bonds looks relatively attractive right now.

The main risk to owning bonds is rising interest rates. When interest rates rise, the value of existing bonds and bond funds falls. Importantly, if you own individual bonds, you normally cannot lose money by holding them to maturity. Central banks such as the Federal Reserve adjust short-term interest rates to control inflation and stimulate economic activity. US government spending and tax policies affect long-term interest rates primarily because they determine how much money the US government must borrow.