H O F T E C
If you are going to install a one-quarter inch bolt somewhere, the last thing you should do is grab the nearest one-quarter inch drill bit. There is much more to the process.
The strength and durability of a bolted joint is partially dependent on the closeness of fit between bolt and hole; the closer the match the stronger the joint.
A loose joint will allow relative motion (wear and fatigue), will allow moisture (corrosion), will cause hardening of the bearing surface (eventual cracking), will transmit loads unevenly to the material it is supposed to hold (stress cracks) and will allow the bolt to cant sideways in a single shear application (cracking under the head of the bolt or thinning a softer material, weakening it).
How long that new airplane will stay "new" is somewhat dependent on how good the joints are by which it is held together.
The craftsman has two problems: one is that AN bolts are nominally undersize by about .003-inch; the other problem is that a drill bit creates a slightly triangular hole. Aspiring builders should check both of these facts out for themselves. Measure a typical AN bolt and then insert that bolt into a hole drilled into a scrap of sheet aluminum. Careful inspection will show light coming through on three sides around the bolt.
How can this poor fit be avoided and a stronger joint be created?
Perhaps you should check the different kinds of Drill Indexes you can buy. Standard is the fractional set - usually from 1/32-inch to 1/2-inch in 1/32-inch increments. Then there are numbered sets - from no. 1 - 60 (.228-inch - .040-inch). Numbered bits are .003-inch oversize relative to their nominal fractional equivalent.
For example, a no. 30 bit is .128-inch and if you use it the hole will be .003-inch larger than the 1/8-inch (.125-inch) it is meant to replace. This bit is used when you use 1/8-inch rivets for example, where you want a bit of clearance so the rivet can be installed easily and where the rivet will expand to take up the slack. This clearance is not a good idea for bolted joints. Lastly there are the lettered sets, from A - Z (.234-inch - .413- inch). Lettered bits are .003-inch undersize relative to their nearest fractional counterparts.
Thus a "D" bit is .247-inch, or .003-inch smaller than the 1/4inch (.250-inch) fractional bit. You could not get a true 1/4-inch diameter bolt into a "D" hole, but an undersize bolt will fit with encouragement.
With this bit (excuse the pun) of background, here are some guidelines to follow:
A. Good sense dictates that the drill should be sharp, in good condition, be held perpendicular to the material and the work and drill beheld as rigidly as the setup will allow.
B. Step Drill. Step drilling is the process whereby you work up to the final size of bit for that hole. For example, if you want a 1/4-inch hole, drill through with a 3/32-inch bit, then a 7/32-inch, and finally the 1/4-inch bit. Better drill indexes have bits in 1/64-inch increments but there will be many bits in a 1/2-inch set that you might never use. The idea is to come up to the final dimension in small increments, with an end result which will be well worth the extra effort. This is a low cost method of obtaining good round holes.
C. Expansion or Taper Ream. A tapered reamer is used much like a tap but its gradual taper allows you to open up a hole gradually and enough to fit your bolt exactly. For example, a 1/4-inch taper reamer goes from 7/32-inch to 1/4-inch over a length of about three inches, giving it a very gradual change in diameter. With a bit of practice you will be able to judge just how far you need to work the reamer into the hole to get a tight fit. Taper reamers can be obtained from tool supply houses.
A fancier version of a taper reamer is an expansion reamer. The cutting edges of this tool can be adjusted so that you can create a clean, parallel-faced circular hole to fit a particular bolt exactly. You might use this type of reamer if you are rich in time and money, or else need to have an exact hole (not tapered) through some thicker material, such as a wing spar or landing gear leg, where tight fits are mandatory.
D. For a good tight fit of an "AN" bolt you should step drill, but instead of that final cut using a 1/4-inch bit, use a letter "D" bit. It is .003 undersize, so that instead of drilling a .250-inch hole for that nominal -.250-inch "AN" bolt (which is actually only about .247-inch), you will end up creating a .247-inch hole for a .247-inch bolt. That is a zero clearance hole and the bolt will have to be driven in. It is unlikely ever to work its way out. More importantly, however, the bolt will bear evenly against the material it is meant to hold, and therefore create a joint capable of giving the design strength of the joint.