September and March are my favorite months because those are the months most of my municipal bonds pay me tax free interest. For the month of September, I racked in $623.84 in tax free income. I also have a leveraged municipal bond ETF that paid me $81.56 tax free interest and a non-leveraged one that paid $62.02 for a total cash flow of $767.42. It’s not much but it’s honest work 😉
Of course I have started to get a bit worried about municipal bonds because there appears to be some fraud in some of these municipalities, particularly around school districts. If you want to learn more, I encourage you to watch the video below.
I am very careful with municipal bonds to the point of creating my own alternative bond analysis rating system based on demographics using AI but there are still no guarantees.
I am hoping that if interest rates drop, the value of these bonds will rise and I may decide to cash them out. The entire point of holding these munis in my cash account was to help reduce tax burdens from our high income that kept pushing us into higher and higher tax brackets. Our tax burden went down from $15000 in 2023 to $5000 in 2024 in part to using this strategy.
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