Municipal Bond Forum
Unhappy in stocks
Q
I receive about $7,000 annually in dividends from stocks. I need this income, but the tax is killing me. Are there municipal bonds that pay a regular interest/dividend that are tax free? Should I consider selling some of my stocks to purchase them? I’m 61 and want to get more security but don’t necessarily want to sell stocks as a panic move. Should I consider mutual funds? My financial planner seems determined to keep me in stocks. My immediate priority is generating income from investments while reducing federal and state taxes.
A
James A. Klotz responds:
We don’t want to upset your investment advisor, but we can assure you that investors who have received their income from municipal bonds for the past 20 years are much happier than those who invested in stocks. If your objective is to produce income, bonds are generally considered the appropriate vehicle, while stocks are usually selected for growth.
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The responses provided in this forum are meant to address specific questions posed by investors about their municipal bonds and to provide market insight for our general audience. Please note, your investments, objectives, results and experience may differ significantly. Our answers and any potential strategies discussed should not be construed as a solicitation to buy nor sell any security or investment product. All investing entails risk.