Definition: Conventional gilts are where the government agrees to pay the holder a fixed cash payment (a 'coupon') every six months until the maturity date, at which point the initial sum invested (the 'principal') is returned. The UK Treasury issues gilts with maturity dates that are five, ten or thirty years in the future.

Once can buy bonds direct. Gilts can be bought through a government department called the UK Debt Management Office (DMO) or 'second-hand' through a broker.

Corporate bonds can also be purchased through a broker. The simplest way is by investing in a gilt or corporate bond fund whose manager will select the best bonds to invest in. Stick to household-name funds and managers, with good track records.

If interest rates were increasing and you could get a better deal borrowing money direct from a bank, or from shares, then the fixed rate of the wouldn't look so attractive and the price could fall below what you paid for it.

Another way to winnow out the best broker is to contact them via email, and see what response you get back. Call them on the telephone. This, coupled with your impression of their web site, will help weed out the 'do not touch with a bare pole' ones.

Investment Goals: Bond funds have specific investment goals, such as pursuing high income or preservation of capital. So should you.

Some funds may limit their bond investments to government (gilts) while others may invest in sectors like corporate and mortgage-backed bonds.

Definition: Duration estimates how much a bond's price fluctuates with changes in the interest rate. If rates rise 1.00%, for example, a fund with a 5-year duration is likely to lose about 5.00% of its value.

Definition: Performance. A bond investment fund's total return over time. Total return is the market value of its bonds + the income from them. Investors (you) interested in income should look at the fund's 30-day yield.

Higher yields usually come with some caveats. A fund may achieve higher yields by incesting in lower-quality securities, which may make the share price (or value) of the bond fund investment more volatile.