A Bond of Another Kind

[Boomer]

I am getting really spoiled by being able to throw a question out there to TOTVers and getting information back pretty quickly.

This morning I will no doubt be eligible to win a prize or something for trying to start the most boring thread ever in the history of TOTV.

Although I really hope you are all enjoying those wonderful temperatures and blue skies there and are not chained to the infernal machine (sorry JohnZ) today, I thought I would ask my boring question anyway and see what you all know about it.

Here goes:

I like to educate myself on investment topics, but I have to admit that reading about bonds as investments is somewhat akin to volunteering to having my head pinched in a vise.

What I want to know is what anyone can tell me about highly-rated municipal bonds as investments and how to research and buy them outside of a fund.

btw - How is that potential club that was being discussed a few weeks ago coming along? - the one for just plain learning about investments.

Now, Boomer BeBack (Help me, Rhonda, I am talking about myself in third person. - too much snow this weekend.) will be turning this thing off and checking in later. I gotta get something done today, but I will be back.

Thanks for any help you can give me.

BB

[nONIE]

Boomer,

Sure is a boring question but undeniably an important one. ::) go to Bob Brinker.com, he has excellent advice on investments. We have been very pleased following his advice with great results!

[gonzy]

Boomer,
The ratings on muni's are the same as conventional bonds i.e. a triple A rating is the highest possible rating. The ratings are based on the credit quality of the issuer. Most brokerages have a bond desk (I use Schwab). They can advise you about individual issues. There is a primary and a secondary market for muni's just like regular bonds. I also prefer to buy individual issues rather than funds because I can hold them to maturity without worrying about interest rate changes that affect funds. Hope this helps.

[travelstiles]

Hi Boomer,
As a CFP, I LOVE to read about investments (in fact I am taking a reading break from the Journal of Financial Planning to check out TOTV for a few minutes). I'm the one who posted earlier last month about forming the investment club (or as I'd like to calll it, the Financial Fitness Club). I had listed a few educational links to see if there was any interest in my posting others, but didn't get much of a response on that, although many posts indicated an interest in the club (I'll be in TV permanently after 12/28).

Below are a few links about bonds, some more advanced than others, but you really need to understand the effective tax yield to decide if a tax-free or tax-advantaged bond is your best investment choice over taxable bonds or other alternatives. There is a simple calculation for this which you can find on these sites, or we can discuss it further when the club gets started. I would begin by asking your accountant if it makes sense to even look at munis, particularly since Florida has no state income tax, then do lots of homework before you invest.

http://www.dolans.com/search/results.html (very good resource, and they are not selling anything - use the search feature)
http://www.sec.gov/answers/bondmun.htm
http://www.investinginbonds.com/learnmore.asp?catid=8
http://finance.yahoo.com/education/bond
http://www.smartmoney.com/university/investing101/bonds/

Let me know if you'd like more info on any financial topic!