Municipal Bond Forum
Security and return
Q
I will have sizeable returns from maturing bonds soon. As a senior citizen, I would like to reinvest these returns only where federally insured. What might you suggest?
A
James A. Klotz responds:
If you must have U.S. government guaranteed securities, your choices will be CDs, Treasury bonds or GNMA securities, all of which unfortunately provide very slim, taxable returns.
In the tax-free bond market, you would be restricted to bonds escrowed in U.S. government securities, also with negligible yields
We would suggest there are many well-secured municipal bonds that provide positive returns, after factoring in the rate of inflation. Federally guaranteed securities will not.
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