Wednesday, January 4, 2023

This Might Be An Interesting Alternative to My Current High-Yield and Moderate-Risk Portfolio

 A variety of Idaho municipal bonds are available with yields around 3%.  Interest on municipal bonds are exempt from both state and federal income tax, if you are a resident of that state.  (This matters a lot when you are in a 34% marginal income tax bracket.)  A 3% yield would be about $2500/month.  Not as good as the Trump years were, but still a fair amount of tax-exempt income with the reasonable certainty of not losing it all.  Some are insured against default, although with lower yields (2.5 to 2.7%).

This website shows recent Idaho municipal bonds transactions.   Some are 4.7% yields to maturity!

Even more trading hands with 4.7% yield to worst.

Talk to my wife tomorrow.   These are low-risk compared to the equity mutual funds and without any income tax roughly what we pull out each month from the IRA.  There is not the long term growth potential but we have enough.   I do not need a Gulfstream 5.

No comments:

Post a Comment