| While Baby Boomers are not the only ones | | | | A Few Things You Should Know |
| nervous about doing any kind of investing at this | | | | The recent economic downturn has dealt many |
| time, they are the ones who probably need to be | | | | states a huge financial blow and this can greatly |
| thinking about the subject very seriously. As | | | | affect the interest rate they are able to pay on |
| retirement looms, knowledge of how you invest | | | | municipal bonds. Many states find themselves |
| your savings so to achieve just the right balance | | | | having to dip into their own savings to pay for |
| of risk and reward is essential. Recently, municipal | | | | unemployment benefits and civil servants' salaries. |
| bonds have been offered up by some financial | | | | Some bond insurance companies are rumored not |
| pundits as the investment of choice for Baby | | | | to have enough capital to back up the bonds |
| Boomers. | | | | they're offering. Do your own research on the |
| Municipal bonds, sometimes called muni-bonds, are | | | | companies that you're dealing with. |
| issued by various entities on behalf of the | | | | Tax-free municipal bonds are often a better deal |
| government. They can be taxed or tax-exempt. | | | | than CDs with are taxed as normal income. You |
| When you buy them, you are basically lending | | | | will have a relatively safe, reliable way of earning |
| money to the government in return for interest | | | | income that is all yours. |
| on it at a certain date when the bond matures. | | | | So are they the Right Choice for Baby Boomers? |
| The tax-exempt bonds are said to be the better | | | | That decision is ultimately up to you. While |
| option for Baby Boomers. | | | | municipal bonds are a great way to earn tax-free |
| There are two types of municipal bonds: General | | | | income, it's important that you do you own |
| obligation and revenue. The money made from | | | | research. Learn about the city and state that you |
| the former is used to pay for the upkeep of | | | | want to invest and see if it's viable in the long |
| cities and states and that from the latter is used | | | | term. Do not invest in states or cities that depend |
| to build and maintain general infrastructure. If you | | | | on the same industry and do not put more than |
| buy general obligation bonds, the state in which | | | | 20 percent of your savings into the same type of |
| you invest is responsible for giving you your | | | | investment. As with most investments, there is |
| returns. If you buy revenue bonds, your return is | | | | good money to be made...if you know what |
| based on the income earned from the projects | | | | you're doing. Good luck. |
| that it was used for. | | | | |