Considering investing in municipal bonds for tax-free income? Let’s start with the bad news: The main muni index, tracked by the iShares National Muni Bond exchange-traded fund, yields just 3.1% right now, or 4.3% on an after-tax basis for those in the 28% federal tax bracket. Compare that to a 5% yield in a money-market fund.
Not that enticing, right? That’s what Barron’s concluded in its review of the best income investments for 2024.
Still, plenty of investment strategists like the safety of the asset class and are finding different ways to squeeze a bit more juice from the lemon. Munis look even better for individuals in a top bracket in a high-tax state, where that 3.5% is the equivalent of a 6% taxable yield.
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Barron’s
By Amey Stone
Jan 25, 2024,