Municipal Bonds.Any good?
- Thread starter mvphilly
- Start date
I looked at some regular munis but after comparing the tax equivalent yield the taxable munis, t bills, agency, and cd yields were better.
Missing the boat... 3-month maturity at over 5.25% APR and state tax free
I've got a MM fund thats paying over 6% and very liquid.
Last year I had one a friend recommended, I think it was an "I' Bill that was paying around 9.25 but you could invest only 10K. When the rate dropped at renewal I bailed. Do you know what it is now?
No...I don't follow I bonds. The $10K limit does me no good.
If you have an MM paying 6%, that is outstanding. I know of no such investment
Where?
The only two I know of paying this rate without "debit card acrobatics" to meet each month are limited in amount of deposit that earns the 6%
one is DCU limited to $1000
and the other is Mango limited to $2500
You are referring to I Bonds, completely different animal from a T-Bill
Here is the current I Bond rate
When you invest you make your money 'visible' to the tax man.
Don't do that.
In the long run you would be better off having it as cash stuffed into a safe.....better yet as gold bars or coins.
You won't make the interest, but you won't lose by letting them know you have it.
Sure it might sound sleezy....but do you want to pay taxes on money you've already paid taxes on.....probably 2 or 3 times by now ?
You get taxed when you make it, you get taxed when you spend it, and you get taxed if you hold on to it......that is, IF they know you have it.
Think.
Don't do that.
In the long run you would be better off having it as cash stuffed into a safe.....better yet as gold bars or coins.
You won't make the interest, but you won't lose by letting them know you have it.
Sure it might sound sleezy....but do you want to pay taxes on money you've already paid taxes on.....probably 2 or 3 times by now ?
You get taxed when you make it, you get taxed when you spend it, and you get taxed if you hold on to it......that is, IF they know you have it.
Think.
The best investment advice I’ve ever seen on line was from Army Jerry years ago, “BUY MORE AMMO”!!
I should have bought a warehouse full around 2007.
I should have bought a warehouse full around 2007.
Not earning means you ar losing purchasing power due to inflation. Might want to rethink
Better than sitting in an account earning nothing at all. I’ve had nearly $100k in an account just sitting for years. Talk about stupid.
I agree with you except for keeping cash. At some point, maybe soon, paper money will be useless on a secondary market. Gold and ammo will be of more value. And it can't be wiped out by a few key strokes. I know this is a little different scenario the investment angle. Things are happening fast and .Gov doesn't want you to have anything.
That is specifically why I had said "better yet gold bars or coins".
Don't bother with silver, never been worth a shit except as a low value coin and gems won't be worth anything if a true crash happens (like I'm sure we are all expecting).
I agree cash isn't the best....but for short term, eh ?
@muzzleloader
Do you honestly think banks are going to exist decades from now ?
Or, the stock market ?
The 8-30% I mentioned would be your tax.....annually.
You are better off paying taxes on your growth than not having growth.
Wow, hard to believe that needs to be explained to you.
On the flip side.
You make 5-6% per annum on the bond, then you pay 8% or more on taxes.
You end up losing 2-3% per year.
I know those rates are not exact, but you get the drift.
If you didn't know, it's called "capital gains".
I'd rather make 0 than lose whatever it amounts out to.
You don't get that ?
Hard to believe that needs to be explained to you.
Using your numbers you would pay 8% or more in taxes on the 5-6% you make on the bond not on the total value of the bond.
Muni bonds are subject to market fluctuations just like T notes/bills, yields go up/down daily, and the yields shown on a particular day are IF you hold the bond to maturity. If you are looking for TF income, TF bond funds are one option, but STCG's are usually realized on an annual basis to pump up the YE numbers for marketing purposes. Individual muni bonds are extremely hard to find/purchase these days as the MF's usually purchase the entire issue before it even hits the "market" since their partners in crime do the underwriting for the bond issue, and are aware of all the details before the general public hears about it on the news.
Not too many investments are safer than a CD in an FDIC insured institution. Rate risk is the only downside, but the key for each individual is to determine how long of a time frame can you not have access to the $$ w/o any interest penalty for early WD.
Not too many investments are safer than a CD in an FDIC insured institution. Rate risk is the only downside, but the key for each individual is to determine how long of a time frame can you not have access to the $$ w/o any interest penalty for early WD.
Of course there is more to it
Every investment vehicle has a place as can be imagined.
The combination of
How old you are
Liquidity needed
Is it wealth preservation or growth
Are you close to retirement
State you live in
Annual income
And a million more
But if anyone thinks they will earn more because they are not making taxable interest I truthfully think you should reevaluate your investment strategy.
Every investment vehicle has a place as can be imagined.
The combination of
How old you are
Liquidity needed
Is it wealth preservation or growth
Are you close to retirement
State you live in
Annual income
And a million more
But if anyone thinks they will earn more because they are not making taxable interest I truthfully think you should reevaluate your investment strategy.
Stop making sense. You’ll confuse the brain trust
Only on the hide could a simple question regarding an investment vehicle turn into a debate about investment strategy
Muni bonds are awesome if you are in a high income tax bracket and can benefit from the tax advantages of paying no federal income tax on the interest.. when the 10 year treasuries were 4.5% you could find munis at 5% or 5.5%. If you live in a state with state income tax, and you buy a muni from your state you may also be exempt from state income tax on the interest as well.
they are very safe - in that they have a very low default rate, and you can buy them insured as well - which means if the state/city does not pay, the bond insurer pays.
You will hear many say that returns in the stock market are better, and they are but with more risk - sometimes slow and steady is better - especially if you are looking to build a safe income stream to live off of, or supplement your income.
Muni bond income is also not subject to the 3.8% medicare surtax on investment income for couples making more than $250k
For the member that said "put it in your mattress... " while I agree you should have some cash on hand, inflation is a tax on all paper money.. here is a chart that shows the longer you hold cash the less it buys - it literally becomes less valuable due to inflation - for everyone... low and high earners.
As you point out - buying gold or ammo does help as gold prices rise with inflation usually, and as many have seen over the last couple years so does ammo prices unfortunately. Gold and ammo do not provide income.. only a store of value
they are very safe - in that they have a very low default rate, and you can buy them insured as well - which means if the state/city does not pay, the bond insurer pays.
You will hear many say that returns in the stock market are better, and they are but with more risk - sometimes slow and steady is better - especially if you are looking to build a safe income stream to live off of, or supplement your income.
Muni bond income is also not subject to the 3.8% medicare surtax on investment income for couples making more than $250k
For the member that said "put it in your mattress... " while I agree you should have some cash on hand, inflation is a tax on all paper money.. here is a chart that shows the longer you hold cash the less it buys - it literally becomes less valuable due to inflation - for everyone... low and high earners.
As you point out - buying gold or ammo does help as gold prices rise with inflation usually, and as many have seen over the last couple years so does ammo prices unfortunately. Gold and ammo do not provide income.. only a store of value
