A municipal bond, commonly known as a muni, is a bond issued by state or local governments, or entities they create such as authorities and special districts. In the United States, interest income received by holders of municipal bonds is often, but not always, exempt from federal and state income taxation. (Wikipedia)
Municipal Bonds are bonds purchased when you loan money to a municipality. They are considered long term investment vehicles. My next investment will be this option in Maricopa.
Are municipal bonds a good investment?
Investing in municipal bonds is a good way to preserve capital while generating interest. Most of them are exempt from federal taxes, and some are tax-free at the state and local level as well. Municipal bonds, help build infrastructure in your area.
When you purchase a bond (usually in 1k increments) you are (loaning money to a city) for a term of usually 10 years.
At the maturation date (10-year Mark) you can cash in the bond plus the interest. Interest can be as high as 10% depending on the city. Muni bonds are usually very safe (low risk.)
