Village community development bonds

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  #11  
Old 04-07-2018, 12:52 PM
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jojo jojo is offline
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My contact for FMS bonds is Edie Nasello, Sr. Vice President 800-741-1103. She works directly with The Villages.
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Columbus OH, The Villages - Amelia

  #12  
Old 04-07-2018, 01:11 PM
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Unless you are interested in the novelty of owning bonds associated with our CDDs, why not consider these Vanguard offerings - no load & low cost:
Vanguard Bond Mutual Funds
Vanguard Bond ETFs
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  #13  
Old 04-07-2018, 04:49 PM
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jojo jojo is offline
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Quote:
Originally Posted by champion6 View Post
Unless you are interested in the novelty of owning bonds associated with our CDDs, why not consider these Vanguard offerings - no load & low cost:
Vanguard Bond Mutual Funds
Vanguard Bond ETFs
Champion6, I own four different Vanguard bond funds and none of them in recent times are paying what these bonds are paying. I like having some fixed rates in my portfolio. That said, it is challenging to discern what the expense rates are and I'm sure it's greater than Vanguard. Overall, Vanguard cannot be beat for low expense rates.
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  #14  
Old 04-08-2018, 07:57 AM
dave042 dave042 is offline
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Quote:
Originally Posted by champion6 View Post
Unless you are interested in the novelty of owning bonds associated with our CDDs, why not consider these Vanguard offerings - no load & low cost:
Vanguard Bond Mutual Funds
Vanguard Bond ETFs
the stock market is where you make money. bonds don't offer you any protection from default. if too scared to pick individual stocks, go with an S&P or NASDAQ index fund. the fees on them are minimal. whatever you do, don't buy mutual funds. their fees are crazy high.
Who knows?
  #15  
Old 04-11-2018, 12:01 PM
thetruth thetruth is offline
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Default 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. .
Different strokes for different folks
  #16  
Old 04-11-2018, 12:27 PM
thetruth thetruth is offline
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Default Different strokes for different folks

Quote:
Originally Posted by dave042 View Post
the stock market is where you make money. bonds don't offer you any protection from default. if too scared to pick individual stocks, go with an S&P or NASDAQ index fund. the fees on them are minimal. whatever you do, don't buy mutual funds. their fees are crazy high.
There are books on everyone of the things you mention.

Bonds don't offer any protection from default. If, you think it is worth what you will pay for it by reduced yield, you can purchase insured bonds.
Stocks? The term default, is not the proper ones BUT, KODAK-comes to mind. ENRON-comes to mind. BP was destroyed. GE has???

RE: MUTUAL FUNDS
I assume you are comparing them with ETFs. Each time you buy shares in an ETF you pay a COMMISSION. Commissions have dropped in recent years-IT HAS NOT ALWAYS BEEN $5.00. EVEN THE MANAGEMENT FEES-some companies with 401Ks etc get lower management fees on the same funds that others buy and pay full fees-diff is about 1/3 less. Vanguard with probably amung the lowest fees in the industry offers ADMIRALTY shares. With a balance of ?????? 50,000 in the funds I know about, the fees for the same fund drop by 1/3.
  #17  
Old 04-11-2018, 03:47 PM
784caroline 784caroline is offline
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I have owned these bonds since 2008 and they fit for me a good part of my tax free portfolio. The bonds that were being questioned by the IRS were the Recreation Bonds issued by the Villages but that objection has been dropped a few years back.

The Community Development Bonds are NOT the Recreation Bonds. These are the bonds that are attached to each and every new house in The Villages that pay for the infrastructure supporting that particular VCCD District. They are not insured BUT you and I live here and you certainly dont see many foreclosures on homes never mind people not paying their bonds. In fact many people pay these bonds back early. You are guaranteed the first 5 years of interest payments which are made twice a year. After the first 5 years depending upon how many of the bonds have been prepaid by the homeowners in that District, the VCCD can randomly call via a lottery system which particular bond (in $5K increments) to call in early at par. SO if you paid 100 for the bond you would get 100 back...if you paid 95 for the bond you would get 100 back. It is very likely the vast majority of these bonds will be called in 10 years from issue date...ie never reach maturity ..you in essence are getting long term rates with a good chance it will be a short term play ie less than 10 years.

I have tried to buy these bonds either as new issue or on the after market from 3 different brokers...they could not get them. Note these bonds will fluctuate in price but you will not lose any money (unless you sell below par) but you will still get your semi annual dividend payment Federal TAX FREE. If you bought the bonds at par(100) or less you will at least get your money back when or if the bonds are ever called early or even at the 10 year mark.

These Bonds can be bought through FMS BONDS in Boca Raton Contact Edie Nasello at 1-800-741-1103. They get a good majority of these after market bonds via estate settlements.

BTW...with bond funds (Vanguard/Fidelity etc) you can lose money if interest rates rise because you have no specific maturity date upon which the individual bonds can be redeemed.

Any questions on these bonds send me a PM.
  #18  
Old 04-12-2018, 02:58 PM
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daca55 daca55 is offline
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Great post! Very informative concerning my original post. I PM you.
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