Understanding Bonds and How to Use Them #15
Do you own any bonds? Have you ever considered using this investment tool but want more information before you make the purchase? What is the best approach to using bonds as a part of your long-term investment strategy? If you’ve ever wondered about using bonds, this is the episode for you! Should you pick a corporate bond or a municipal bond? Discover the tips and insights you need to make the best decision for you and your family - have pen and paper ready as you listen to this informative episode!
You will want to hear this episode if you are interested in...
What is a bond and how can do you use it as a part of your investment strategy? [1:15]
How are municipal bonds different from corporate bonds? [7:30]
Why buy a municipal bond over a corporate bond? [10:30]
Is it a good idea to buy a US Savings Bond? [12:30]
How to use bonds in your investment strategy. [15:00]
Risks with using bonds. [17:00]
Closing thoughts. [19:30]
What are bonds?
If you are new to exploring the idea of using bonds, don’t worry - I’ve got you covered. When it comes to bonds there are three types that we are going to focus on; corporate bonds, municipal bonds, and US Savings bonds.
Corporate bonds. A corporate bond is a type of debt security that is issued by a firm and sold to investors. The company gets the capital it needs and in return, the investor is paid a pre-established number of interest payments at either a fixed or variable interest rate.
Municipal bonds. Municipal bonds are issued by state and local governments. These can be thought of as loans that investors make to local governments, and are used to fund public works such as parks, libraries, bridges & roads, and other infrastructure.
US Savings bonds. U.S. savings bonds are a form of government debt issued to American citizens to help fund federal expenditures. Savings bonds are sold at a discount and mature to their full face value, and do not pay regular coupon interest.
Which bond is the right one for you to invest in? Are you ready to pull the trigger and make it happen? To learn more about each of these types of bonds and how the details impact investors like you, make sure to listen to this episode!
Using bonds as a part of your investment strategy
Are you ready to jump in and see what it would mean for your investment strategy to embrace the use of bonds? While using bonds does force you into a conservative investment strategy, that doesn’t have to be the case across the board. You'll earn interest on the bonds, but they may have rules as to when you can redeem them. Generally, savings accounts are ideal for low-risk, short-term savings and bonds are ideal for low-risk, long-term savings. Explore your investment options and so much more on this powerful episode!
Resources and People Mentioned
https://www.investopedia.com/terms/s/serieseebond.asp
https://www.investopedia.com/terms/s/seriesibond.asp
https://www.municipalbonds.com/