Municipal Bond Forum
Advice different for an 80 year old?
Q
I’ve been a long-time client and have been following FMS’ advice on taking tax-free income and holding my bonds to the end for return of capital. I am now 80 ½ years old. I read your article, “Bad Medicine for an Imaginary Illness,” and cannot see how it applies to my specific situation. As a client who is over 80, what do you recommend I do with my long-term holdings?
A
James A. Klotz responds:
We are quite pleased that by taking our advice, you have been earning a generous, consistent stream of tax-free income that could only have been achieved by investing in long-term municipal bonds.
Our advice to an 80-plus-year-old client is the same it is for all of our clients. We always recommend, that after taking quality into consideration, you maximize your income by continuing to buy long-term bonds as your investment dollars become available.
As a long-term investor, I’m sure you recognize that sometimes your bonds are worth more than you paid for them, and sometimes less. Your tax-free income, however, remains constant.
Start here.
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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.