Abstract: A solder composition that bonds well to oxides and other surfaces to which solder bonding is conventionally difficult is provided. The solder is particularly useful for reliable bonding and packaging of optical components that often have oxide surfaces. The solder composition exhibits a microstructure containing a solder matrix in which is distributed fine, micron-scale islands of rare-earth-containing intermetallic particles. The existence of the islands makes the rare earth elements better available for bonding, and reduce the extent to which the rare earths are oxidized. Advantageously, the solder contains Au and/or Ag, in which the rare earth elements tend to have some solid solubility. Due to this solubility, the Au and/or Ag tend to provide some additional protection of the rare earths against oxidation, and thereby also provide accelerated dissolution of the rare earth into the molten solder.