If you want to invest in bonds, you need to know how to read the bond ratings that the big three rating companies use in order to help you select bonds in a risk-aware way. Knowing the right questions to ask about a bond can save you money, and you can find answers to many of those questions on the Internet.How to read bond ratingsBefore you buy a bond, get an idea of how much financial muscle the issuer has.

In a down economy, U.S. savings bonds are one of the safest investments you can make. Savings bonds are nonmarketable securities — when you purchase them, they’re registered to you and you can’t sell them to another investor. Uncle Sam offers two types of savings bonds, Series EE and Series I, which are backed by the full faith and credit of the U.

Returns on savings bonds are so low that they’ll never make you rich. In fact, returns are so low that large pension funds and other big investors don’t purchase savings bonds. However, for many individuals, savings bonds are the best approach for saving money. Factors favoring savings bond are that you can Save automatically.

You may think of bonds as thoroughly modern financial instruments, but they have a long history. They played an important part in helping the Allies win World War II, for example.Every bond needs to be identified, which is where its CUSIP comes in. When you reach a certain age, the government requires that you begin withdrawing at least some money from your accounts, and you need to pay close attention to this, because if you don’t cash out the minimum amount, big fines are levied.

One of the hottest debates among investors — one that will never end — is whether actively managed investments are any wiser than index fund investments. The simple answer is usually no, they are not. The vast majority of index investors do better than the vast majority of active investors. Although various studies show various results, none contradicts the basic premise that indexing works, and works very well.

Bond investing has a reputation for safety, not only because bonds provide steady and predictable streams of income, but also because as a bondholder you have first dibs on the issuer’s money. A corporation is legally bound to pay you your interest before it doles out any dividends to people who own company stock.

Bond investing has a reputation for safety not only because bonds provide steady and predictable streams of income, but also because as a bondholder you have first dibs on the issuer’s money. A corporation is legally bound to pay you your interest before it doles out any dividends to people who own company stock.

If you want to invest in bonds, you need to know how to read the bond ratings that the big three rating companies use and how to figure whether a taxable or tax-free municipal bond is the better investment. Knowing the right questions to ask about a bond can save you money, and you can find answers to many of those questions on the Internet.