Guide To Buying Municipal Bonds (ESSENTIAL | 2025)

: These are backed by the "full faith and credit" of the issuing city or state. They rely on the municipality's general taxing power (like property taxes) to repay bondholders.

Buying municipal bonds (or "munis") is a strategy for investors seeking regular income with significant tax advantages. In 2026, the Indian municipal bond market is seeing a major push due to new government incentives designed to fund urban infrastructure. 1. Key Types of Municipal Bonds guide to buying municipal bonds

: These are funded by revenues from a specific project, such as a toll road, airport, or water treatment plant. They carry more risk if the project fails to generate expected income but often offer higher interest rates. : These are backed by the "full faith

: Current yields for municipal bonds typically range between 7.5% and 10% , which is often higher than traditional fixed deposits (FDs). In 2026, the Indian municipal bond market is