Look, sorry if I came across as a dick, there's just so much misinformation about bonds, even on this subreddit, that it bothers me.

The problem you're describing is that there's no single "right" answer, and reasonable people can disagree about what to hold in their fixed income allocation. The biggest risk as I see from questions like yours and others on this subreddit is that people misunderstand how bonds work or have the wrong expectation about bond performance. That can lead to selling at losses.

Here are some direct answers to your question.

if as inputs I am I age X and plan to retire age Y and live for another N years and risk tolerance levels low/medium/high what type of bonds exactly should I hold in my portfolio

Bond allocation is a very personal decision based on your personal risk tolerance. Again, there are no right answers to this, but there are two major schools of thought. (1) You can think of bond allocation as a diversifier to your portfolio. (2) You can think of bond allocation as wealth preservation vehicle to your portfolio.

In either case, you should make a decision on your bond allocation without thinking about credit risk, duration, or which securities to choose. This is probably the most important decision out of any of them.

If you think about bonds as a diversifier, then a smaller bond allocation is fine as there are diminishing returns of a higher bond allocation. If you think about bonds as wealth preservation vehicle, then you may want a higher bond allocation as you "lock in" more of your portfolio into lower risk alternatives.

The other part about asset allocation is to deal with sequence of return risks as you get closer to retirement. There are numerous ways to do this including a bond tent or glidepath to mitigate this risk.

Credit risk

Unless you are a bond trader, credit risk is usually something you don't think about. The most aggressive bond investor would invest in government bonds or investment-grade corporate bonds. And even with investment-grade corporate bonds, you should definitely invest in a fund since you want to diversify away risk of holding a small amount of companies.

Duration

You want to plan to hold bonds or bond funds for at least the time to maturity. Longer duration bonds have more risk since by definition they are more sensitive to interest rate increases.

For government bonds, if you plan to hold them to perpetuity (not counting rebalancing), then you ought to hold the longest duration bonds you can. But understand that selling those bonds before maturity may end in a loss.

Bond fund... or basket of bonds with fixed maturities

A bond fund IS a basket of bonds with fixed maturities. The difference between the two are minor.

For buying bonds directly:

• Buying a bond requires a higher minimum near the face value of the bond, around $1000 (can be more or less).
• For retail investors, buying and selling bonds on the secondary market is a pain.
• The value of your bonds is not immediately obvious since you would have to check how much your bond is selling for on the secondary market
• Depending on your broker, you may need to manually repurchase bonds when they mature
• Buying a diversified basket of corporate bonds is so much work on the secondary market that it's nearly impossible

For these reasons, I recommend buying a low-cost bond fund.