Help support our online development, and advance our onground research initiatives in health care economics and finance, as we seek to showcase the brightest Next-Gen minds.
Understanding Municipal [Muni] Bonds
State and Local Debt Issues
Staff Writers
Municipal bonds are issued by state and local governments for building schools, bridges, hospitals, and other municipal facilities. These bonds depend upon their tax base to generate the income to pay the interest and retire the debt.
Tax-Exempt Status
The most important feature of municipal bonds is their tax-exempt status. While the interest earned is free from federal income tax, state and local governments may levy taxes on that income. Therefore, because of the tax advantage, municipalities can borrow at lower rates of interest than can corporations.
The physician-investor benefits because the tax advantages associated with the interest, albeit lower than that of corporate or government bonds, may provide a higher rate of return. Municipal bonds are usually sold in increments of $5,000, $10,000 or more, although municipal bond funds may have lower minimums.
Types
Municipal bonds are available in various types, depending upon whether the debt is paid by the issuing authority or by the revenue earned from the facility.
Conclusion
Have you ever taken out a municipal bond; what was the reason and results?
Related Information Sources:
Practice Management: http://www.springerpub.com/prod.aspx?prod_id=23759
Financial Planning: http://www.jbpub.com/catalog/0763745790
Risk Management: http://www.jbpub.com/catalog/9780763733421
Healthcare Organizations: www.HealthcareFinancials.com
Health Administration Terms: www.HealthDictionarySeries.com
Subscribe Now: Did you like this Executive-Post, or find it helpful, interesting and informative? Want to get the latest E-Ps delivered to your email box each morning? Just subscribe using the link below. You can unsubscribe at any time. Security is assured.
Link: http://feeds.feedburner.com/HealthcareFinancialsthePostForcxos
Filed under: Investing, Portfolio Management
Muni-Bond Funds
According to Christine Thompson MBA, who manages and oversees the $20 billion dollar Fidelity Municipal Income Fund, “values in the muni-market relative to other asset classes are unprecedented.”
Furthermore, she recently opined that, “we are in a cascading credit contraction that may be difficult to remedy.”
Any more interesting - or - thought provoking opinions on this topic?
-Ann