Safe & tax fee way to invest?

Question

what is the safe and tax free way to invest? higher interest is even better, but i guess this is not possible

Answer 1

You're asking for the impossible. Consider:

treasury bills (tbills) are free from state & local taxes.
http://www.treasurydirect.gov

Municiple bonds, if tax free is so important to you.

Consider getting http://www.moneymagazine.com

IRA, ROTH IRA & 401k retirement plans also have some tax advantages but they are for long term investments.

Answer 2

you are definitely NOT asking the impossible.

There are municipal bonds BUT…. Even better

Everything you put into a Roth IRA comes out tax free… so any investment you make stocks, bonds, indexed funds or CD's etc are all tax free in a Roth. You can open a Roth even if you have a 401k(but there are some income limitations so check that out). Now.. if you need the money from a Roth, you can take out the principal (not the earnings) tax and penalty free after 5 years.

saftey is a double edge sword. Putting all your money in a safe deposit box is safe, but it's a bad investment because it depreciates over time.

search the internet for "asset allocation" and learn about it.

a well allocated portfolio is has lest risk than many 'safe' investments because of inflation.

The real estate market is over... housing is slowing and prices are starting to drop... don't consider that unless you are buying a home for yourself to live in fairly long term.

I would also stay away from annuities unless you are close to retirement. They are very often bad investments for you but great money makers for the brokers.

Answer 3

There is only one way to invest safe and tax free. life insurance. Tax deferred: Fixed Annuities - we pay 6.5%

Life insurance is the only investment that is completely tax free. But, you have to look at it as an investment, not your typical definition of Life Insurance.

Example: If you are 40, don't smoke and want a million dollars of life insurance to pass on tax free to your wife/kids, family, etc. You pay in $1000 a month for the million dollar policy. you do this as an investment for say 20 years. If you die in that 20 years, your investment money passes tax free to heirs. If you choose to cash out after 5, 10, 20, etc years. Your cash value will far supercede the money you have put in and it is tax free. Your cash value after 20 years should be about $300k and you have only paid in $240K and have that 1M protection the entire time.

Or you could take a one time payment and put it in a single premium paid up life insurance policy. If you are 60 and put in 100K then it would give you $200k upon issue to pass to heirs tax free. Hope that helps.

Answer 4

Invest in real estate.

you can purchase a home then rent it out. The tenants will be paying the invest home off for you. In the long term the house will eventually be paid off. Usually 30 yrs. But in the short term the property will build equity.

30 yrs from now when the house is paid off...the home you initially purchased for $150k is now worth nearly half a million or more.

Answer 5

according to me safe and tax free way tio invest would be,
insurance policy, ULIP i.e unit linked insurance products, home loan,
if you are salaried than you can invest upto Rs 100,000 in G-secs that is government securities, bonds

Answer 6

have your own religion.. be a priest and collect the contributions of your followers... church has no tax.. but has a very huge income....you work for an hour for the mass and you get contributions more than one week of your salary... no offence for the religious group,... just a point of view.. im too is a religious person... God bless....

Answer 7

no annuities. No whole life. IRA if you are willing to invest in equities. Otherwise get your 4% or so in Munis & be happy.

Answer 8

Municipal bonds

Answer 9

safe and tax free won't grow much at all. try something more risky like stocks.

Answer 10

You really want tax fees? Pay your taxes late - that will do it.