Anyone Hitting the Bond Market?? We hit a MILESTONE!!!!!!!!

[tobee43]

just wondering?????

i'm doing sewers because we have to use the toilet

transit...because we have to get there...

and community colleges because major u's are so expensive????

all tax free i'm getting approx 4.6% tax free both state and federal.

all 0 coupons, i know not really aggressive but safe.

it's been really hard to pick save more or pay off this mortgage...yesterday was a milestone for us...we have owned this house 2 years this past feb 15th and yesterday hit owing BELOW 20k on it!!! i'm sooooooooooo psyched! (i think the balance is closers to 16k). who would have thought! i have still been managing to save X amount come rain or shine monthly and then gather it and go looking for the best deals...i know these bonds are 2 steps up from the mattress...one from a regular savings account, but i think it's been time to get back into this...i hope.

i am SCARED LOL!!!

[bcss]

Great to hear tobee, but don't bonds fluctuate with the interest rate? I.e. price of bonds go up when the interest rate drop and go down interest rates go up? I don't know if this applies to government bonds. 4.6 return isn't bad compared to saving rates (mattress money) Congrats on the house. Just keep it up.

[tobee43]

well, these are not government bonds, i don't do those...these are muni's...no these do not fluctuate they sit still but you have to sit for years and you can't touch them unless they are called in early...that just happened to us with the san fran airport bonds we had, they were called in and we were getting over 5% tax free.

i have all types of bonds and they all vary, at this point in our lives we cannot take any chances....also any income added to our gross income makes our ss more taxable...so you need to keep any type of investment tax free if possible. corp bonds use to be my bonds of choice.

we are trying to keep it up, it's just like this month i go into the kitchen and the faucet falls apart, and then the fan shorts out and so on and so forth. all stuff we use to be able to do ourselves, but not now, for the moment anyway. even tho we have a "repair" fund, it always seems like when it rains it pours. i was tempted NOT to put into my regulars savings, a big NO NO for us.

[pamkev]

I have start getting back in the market while still saving money. What makes me sad stocks I paid 7 dollars a share are now worth over 40 but alas I sold everything trying to keep our head above water when hubby's job went south along with the market. I keep telling myself we would not have been able to keep it anyways if we still had it when we filed BK as the TT would have took it.

[tobee43]

oh! i'm scared of stocks!! LOL!! no way and i'm not loving those blue chip mut funds either. i want something safe and no roller coaster ride. i'll go for the lower return on my money but safer when it comes to protecting the principal.

[iswmle]

How exactly do bonds work? And what is a good situation for them? Ex: Fiance and I have about $8k saved up, but that is for a trip. We are getting ready to save up for a home which we are planning to buy in the next 4 years (hopefully) but recognize that keeping the money in a savings account is not a good idea. Would something like bonds be ideal and is it something you go through an accountant with? We have Capital One's Sharebuilder if that makes a difference, btw.

[LadyInTheRed]

How exactly do bonds work?

I'm no expert, but here is how I understand it.

A bond is basically a loan you are making to the government or a corporation. The federal government issues treasury bonds, local governments and their agencies issue municipal bonds and corporations issue corporate bonds. A bond has an interest rate and a maturity date. Depending on the terms of the bond, you may receive interest payments on a periodic basis. On the maturity date, the issuer pays the bond back along with any unpaid interest. An issuer might "call" a bond early and pay it off. Or it might default. Most bonds can be bought or sold before their maturity date.

There are variable rate bonds, but I believe most bonds are fixed. If you have a fixed rate bond, its resell value will decrease when prevailing interest rates increase. But, you will continue to receive the income. So, the best time to buy a bond is generally when interest rates are high, especially if you intend to hold it until it matures.

You can buy U.S. Treasury bonds at http://www.treasurydirect.gov/ You can buy other bonds through securities brokers. I don't know much about sharebuilder, but I suspect you can buy bonds in that account. Bonds typically require a minimum investment of $5000. You could invest a smaller amount by investing in a mutual fund that invests in bonds.

I hope that helps. There's a lot information out on the web on bonds and other investment options. Because you need something safe, bonds may be a good option because they are considered pretty safe investments. You may also want to shop around for the best rates you can get on CDs or money market savings accounts. Interest rates are very low right now, so if you go for CDs, you would probably want pretty short term ones so that you can roll them into higher paying CDs later.

Again, I am no expert in investments. So do your own research.

[tobee43]

also, (i'm no expect either), when and if you buy a bond you want to make certain there is some type of rating. i'm certain many have heard of the past expression "junk" bonds. those were bonds rated extremely low.

it's hard to find a AAA rated bond today, some are insured and others are not. i only stay with the insured bonds, that's why i usually stay with city, county or state bonds, they are usually backed. the us bonds are paying so low of an interest rate, you might as well keep your money in your local banks savings account. the one's we currently purchased with rated by moody's A-A- and standard and poors gave it an A, which is good in todays market. i will never purchase an unrated or uninsured bond, but that's just me.

iswmle: you can buy a bond through a broker, depending on the availability, you can buy 1k, 2k whatever that is available, however, the more money you have the "better" bonds availability becomes, and usually the better the choices you have to pick from. bonds are usually for the long term investor, the ones i have mature in like 30 years LOL!! but can be called in earlier and they usually are. each brokerage house may have different bonds they push, or have available, and a few times they may have the same. for example, we use two firms to invest with, after we hit our "magic" number in our savings account, i will call one and if they have anything available , then i call the other to see what they have. i try to purchase the bonds at below par that way there is potential for growth, although my objective is to keep the principle safe, not so much growth. for an example they this firm only had 40 bonds left to buy and i purchased all of them.

each person invests differently depending on where they are in life. we took more chances on the growth when we were younger, now, for us our goal is to get a decent return and protect our little principle and do not increase our tax liability.

[GoingDown]

Back in the early days of my experience with the nightmare of creditors I bought some gold, and now it has increased so much in value. I wish I had bought more of it back then.

[jacko]

I have over $25,000 accumulated in my IRA, all invested in dividend stocks such as coca cola, pepsi, procter & gamble etc. Had my first $100 plus dividends last month and expecting a min. of a 8% payout increase annual. Want a pay raise, purchase stocks that pay consistent divvies and forget about mutual funds.

[kmjatl]

Sherebuilder.com is a good place to start. You can buy fractional shares of stocks and mutual funds. With as little as $50 a month (maybe $25 even)

[tobee43]

Sherebuilder.com is a good place to start. You can buy fractional shares of stocks and mutual funds. With as little as $50 a month (maybe $25 even)

do that have a good selection of choices.

GoingDown: don't we ALL wish we had purchased more gold!!! really gets me we didn't do that. we had some, but not much. it was gone anyway after before we filed and we cashed it in and at that time it was at an all time high, of course it went even higher!

jacko: i don't ever think anyone can go wrong with coke or soda or booze for that matter. no matter the economy people drink that stuff. actually soda is now far cheaper than juice, of course not has healthy but a way to cut one's budget. i know my poor kids were not allowed soda until they were in high school, at which point after they complete a gallon or milk and 2 gallons of juice they can drink some soda! they were bottomless pits in those days LOL!

[pamkev]

Tobee,
I've been doing sharebuilders for years of course stopped when we ran into money issues. I have started up again , it's real easy you can set up for there $12 a month plan or pay as you go which is you pay $ 4.00 for buying your investments. You pick the stock you want and how much you want to buy. It has to be done by 5 pm Monday as they buy on Tuesday. If you can get stocks that pay out dividends you can get the money or reinvest it. I reinvest. Hope this helps some

Pam

[tobee43]

Tobee,
I've been doing sharebuilders for years of course stopped when we ran into money issues. I have started up again , it's real easy you can set up for there $12 a month plan or pay as you go which is you pay $ 4.00 for buying your investments. You pick the stock you want and how much you want to buy. It has to be done by 5 pm Monday as they buy on Tuesday. If you can get stocks that pay out dividends you can get the money or reinvest it. I reinvest. Hope this helps some

Pam

thanks so much pam!! very much appreciate it. i don't do stocks LOL!! we have never owned a "single" stock. i have always been afraid of those, that's why i always stuck with corp bonds, since it protects the principle. i was always of the mind only invest in stocks with what money you could afford to lose, since i never could afford to lose any i stuck with the corp bonds LOL!! problem is or was they usually start at 5k or up the more you have the better choices and the higher the yield, in most cases that is. so i just save up...we just purchased some nj transit a few weeks ago, again tax free both state and fed, that's working well for us thus far. i'm still afraid!!