A BOND YOU’RE NOT FAMILIAR WITH FROM A COMPANY YOU’VE NEVER HEARD OF?

IT COULD BE THE SMARTEST RETIREMENT INVESTMENT YOU MAKE

The Main Advantages of Municipal Bonds

Investors are attracted to municipal bonds for three reasons; safety of principal, regular predictable income and the tax-free benefits. Together, these three elements can make a compelling case for including tax-free municipal bonds in your portfolio.

Potential Safety of Principal

When investing in municipal bonds, investors are paid back the full face value of their investment at maturity or earlier if called, unless the bond defaults. This is important because many investors, particularly those nearing retirement or in retirement, are concerned about protecting their principal. In July of 2021, Moody’s published research that showed that rated investment grade municipal bonds had an average cumulative 10-year default rate of just 0.10% between 1970 and 2020.* That means while there is some risk of principal loss, investing in rated investment-grade municipal bonds can be an important part of your portfolio.

Potential Regular Predictable Income

Municipal bonds typically pay interest every six months unless they get called or default. That means that you can count on a regular, predictable income stream. Because most bonds have call options, which means you get your principal back before the maturity date, subsequent municipal bonds you purchase can earn more or less interest than the called bond. According to Moody’s 2021 research,* default rates are historically low for the rated investment-grade bonds favored by Hennion & Walsh.

Potential Tax-Free Income

Income from municipal bonds is not subject to federal income tax and, depending on where you live, may also be exempt from state and local taxes. Tax-free can be a big attraction for many investors.

About Hennion & Walsh

Since 1990 Hennion & Walsh has specialized in investment-grade taxfree municipal bonds. The company supervises over $3 billion in assets in over 16,000 accounts, providing individual investors with institutional quality service and personal attention.

Our FREE Gift To You

We’re sure you’ll want to know more about the benefits of tax-free Municipal Bonds. So our specialists have written a helpful Bond Guide for investors. It’s free and comes with no obligation whatsoever.