Review:
Municipal Bonds
overall review score: 4.5
⭐⭐⭐⭐⭐
score is between 0 and 5
Municipal bonds are debt securities issued by a state, municipality, county, or other local government to finance public projects such as infrastructure improvements, schools, and hospitals.
Key Features
- Tax-exempt interest income for bondholders
- Fixed interest payments
- Low default rates compared to corporate bonds
Pros
- Tax-exempt status makes municipal bonds attractive to investors in high tax brackets
- Relatively low risk compared to other types of investments
- Help fund important public projects that benefit local communities
Cons
- Lower yields compared to corporate bonds
- Interest rate risk if market rates rise