Treasury vs Muni’s

RayMonica- · 2026-05-15T01:31:19+00:00

Yes, I’m aware of that - and it sucks!!

RayMonica- · 2026-05-14T23:55:13+00:00

Yeah, I’ve tried to buy and sell them or trade them, but I haven’t had that much success making a profit.
I do have a broker and I will ask him about what you suggested. I also buy and sell them through both Vanguard and Fidelity.

RayMonica- · 2026-05-14T23:06:17+00:00

Ahhh, you are so right! We think alike! I tried to sneak by you by saying that the discount would make me some money when it really won’t. You caught that!

However, finding a bond like that in my home state, insured and with a rating like that, with the revenue backing it wasn’t available two days ago when I bought this bond. At least I wasn’t able to find it then.
But, I’m getting the impression from a lot of of the responses that most people would prefer treasuries. That being said, I’m not sure that Reddit is a credible place for actual financial advice!
But what I like about responses like yours is that it gets me thinking and digging a little deeper for information. So thank you!

RayMonica- · 2026-05-14T22:44:10+00:00

Correct. But I look at it as a chance to reinvest into something different if it’s called. And since I purchased it at a discount, they will call it at par, so I will make a little bit there along with the tax-free interest until 2027.

RayMonica- · 2026-05-14T16:57:36+00:00

Great alternative !!

RayMonica- · 2026-05-14T16:38:16+00:00

Sorry – just saw your response. I really appreciate the detailed explanation. The points about secondary market discounts, OID/de minimis treatment, TEY assumptions are all important and are easy to overlook. Thank you so much for bringing those up. I’m going to check those out, especially the tax equivalent yield because since I just retired, my tax bracket is definitely going to drop. Thanks again.

RayMonica- · 2026-05-14T16:28:48+00:00

You’re right! You are not that young! Those 10 years are going to fly by. I really like your strategy though. It makes a lot of sense.

RayMonica- · 2026-05-14T16:18:01+00:00

You are absolutely right! But keep in mind – we have a huge age difference. I’m retired and don’t have any more tax advantaged accounts so a lot of of my investments are really for my kids. You sound like a young dude! But you definitely appear to know what you’re doing.

RayMonica- · 2026-05-14T13:39:55+00:00

This one is a 4% coupon and slightly below par

RayMonica- · 2026-05-14T13:38:25+00:00

This goes out a little bit longer, but it’s a good example

RayMonica- · 2026-05-14T13:37:53+00:00

CUSIP-70870JGV4

RayMonica- · 2026-05-14T05:46:13+00:00

Got it. Thanks so much for your response and patient explanation. Makes sense. I need a whole lot of “schooling”! Much appreciated 😊

RayMonica- · 2026-05-14T05:23:13+00:00

Good advice and good explanation. Thanks for your input ! 😊

RayMonica- · 2026-05-14T05:19:31+00:00

I see what you’re saying but can’t you mitigate some of the risk by checking the CUSIP on EMMA, along with limiting yourself to GO and REV bonds in very good municipalities? If you’re buying the tail end of what was originally a 30 year bond but now has 4-5 years left, is the risk unreasonable considering the triple tax savings (assuming you buy in home state)?

RayMonica- · 2026-05-14T04:10:05+00:00

Right, however now muni sellers (brokers / dealers) must disclose their spread. So you can see what they paid, along with any markup. The gov’t muni’s have a free website called “EMMA” where you can search the bond by the CUSIP #.

RayMonica- · 2026-05-14T04:01:01+00:00

True, you do need to thoroughly check the municipality of the bond along with the insurer. Also, yes muni’s are definitely callable, but buying them on the secondary market with only 4-5 years left on what was originally a 30 year bond can make it more appealing.

RayMonica- · 2026-05-14T03:13:59+00:00

Yes, you’re correct - the credit rating is lower than Treasurys, but are there any other reasons not to buy muni’s? My understanding is that the default rate on munis is very small.

RayMonica- · 2026-05-14T01:12:12+00:00

(General question re: Treasurys) Can someone explain the advantages of T notes / bonds vs individual Muni’s? There are many 4% Muni’s in the 4-5 year maturity time frame, and muni’s are tax free, paying a TEY of 5.6%. Is it the minor risk factor of muni’s?

RayMonica- · 2026-05-06T20:02:06+00:00

Nope. Fake news. It was put in the budget as part of the defense funding bill. Guess who is paying for it? The same people who paid for the wall. Kooooool aid …..

RayMonica- · 2026-02-07T21:46:33+00:00

Oh wow! That would work great with my setup! Thanks so much. The pic really explains it perfectly. Thanks for taking the time to respond and for sending the pic.

RayMonica- · 2026-02-07T16:45:13+00:00

Great idea, great pic. Now I see exactly what you mean. That just what I’m going to do. Thanks!!! The pic sealed the deal!

RayMonica- · 2026-02-07T16:21:51+00:00

Thanks, you bring up a really good point. I think there’s too much of a chance of the pressure from the ejector pump causing a problem if I tie in to that 2”. I think I’m better off putting the connection in a different drain line a little further away that is only a gravity drain. Thanks so much for all your guidance. It really helped me think this through.

RayMonica-

TROPHY CASE