Who knows?
I'm no expert BUT, for me a large part of knowledge is knowing what you don't know. I AM NOT ADVISING-JUST TRYING TO HAVE YOU AWARE.
BONDS-you can buy individual bonds or a bond fund. Some will wonder how a bond fund pays a higher rate than you can get with individual bonds. READ-you will find that a bond fund-all the ones I am aware of- are leveraged. TRANSLATION=they borrow against bonds they already hold to buy more bonds. IN MY MIND, that is buying on margin.
There is interest involved AND AN INCREASED RISK..
The interest paid by a bond, unless they are tax free bonds, is taxed at the highest income tax rate you pay. If, I recall the max rate is around 46%. Stock dividends have a highest rate of 15%
My brother-in-law, who is no dope, just bought 30 year bonds. It is no secret that THE FED will be increasing interest rates. My brother in law told me-PLEASE DON'T LAUGH-HE IS NOT A DOPE-he planes on holding bonds to maturity. HE WILL BE 71+30=101 WHEN THEY MATURE-OH AND THEY ARE ZERO COUPON BONDS-NO INTEREST PAID FOR 30 YEARS.
STOP-before you buy anything ask yourself WHY and understand other options AND WHY YOU ARE MAKING THE CHOICE TO BUY WHATEVER IT IS.
Since, we KNOW, we will not live forever. Far as stocks, bonds, real estate, it pases ti your heirs at the value at the time of your death.
ROTH IRA-You pay the tax on your IRA now but not as you spend the money-SOUNDS GREAT. Except if you are foreced to do a minimum withdrawal from a regular IRA, you pay tax only on what you HAVE TO withdraw. After you pass away, any balance goes to your HEIRS. You can set up an inherited IRA for them and they too will HAVE TO do a minimum withdrawal. They can elect to take more but not less than the minimum. I have one from my parents.
Thanks to the high rate of return from the stock market.After the FORCED withdrawals and the high market returns, it is actually more than they orignally left to me.
Sadly, they did not have much so it is not much BUT, IT IS A GIFT THAT KEEPS ON GIVING. .
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