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Investing in Tax-Free Bonds: A Guide to 5 Key Features

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Summary

Tax-free bonds offer tax-exempt income with government backing, making them a secure, low-risk investment for long-term needs. They are especially attractive to senior citizens, high-income investors, and institutions seeking consistent returns and reduced tax liabilities. This blog outlines their features, investment and redemption processes, and compares them to tax-saving bonds.

Key Takeaways

  • Tax-free bonds provide tax-exempt interest income and stable returns.
  • They are backed by government entities, minimizing default risk.
  • Long lock-in periods require a commitment to long-term investment.
  • Ideal for senior citizens, HNIs, and institutional investors.

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