The U.S. government issues its own bonds from the treasury and from a number of federal government companies. Those maturing in less than one year are referred to as T-bills. Bonds that develop in one to ten years are T-notes, and those that take more than ten years to grow are treasury bonds. Sometimes, you do not need to pay state or regional earnings taxes on the interest they earn.

Munis finance things like health centers, schools, power plants, streets, office complex, airports, bridges and the like. Towns typically issue bonds when they need more money than they collect through taxes. The great thing about community bonds is that you do not have to pay federal earnings taxes on the interest they earn.

While corporate bonds are a greater risk than federal government bonds, they can make a lot more money. There's also a much bigger selection of corporate bonds. The disadvantage is that you do need to pay federal income tax on

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