Municipal Bond Forum
Looking for safety over five to 10 years
Q
Assume that you are 70, retired, have more than $1 million in liquid assets and would like a fairly safe return over the next five to 10 years. What are your top candidates to buy now or keep on watch? I am not requesting a recommendation on a specific bond.
A
James A. Klotz responds:
In today’s municipal bond market, an investor can purchase short-term (10 years or less) securities that provide solid quality and attractive returns.
If you are seeking the ultimate in safety, you might consider pre-refunded munis, which are escrowed in U.S. Treasury bonds.
Many pre-refunded bonds can be purchased today with higher tax-free yields than the taxable yields on Treasury certificates of comparable maturity.
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.