For the past 30 years, bonds have enjoyed a great run, but experts predict that a change may be on the horizon.
"I'm avoiding anything with a government guarantee because the central bank is buying that debt and artificially pushing those (yields) down," says Larkin.
The yields are too low on mortgage-backed securities, U.S. agencies and U.S. Treasuries. In a 5 percent inflation environment, things could change very abruptly, and some of the losses could be quite substantial, he says.
For investors who cannot risk losing any principal, Larkin suggests earning close to zero is preferable to investing in bond funds.
"The risks are rising that the change might be coming," he says.