What’s the best revenge on the IRS? How about collecting up to three fat income checks per month… truly tax-free? That’s right. It’s 100% legal.
Let us find out, if this is any better than our 401 k or IRA, as it’s quite natural, any promise of a Tax Free Monthly Check does always sound exhilarating to any of us at its first undertone.
And any income proposition that a newsletter vendor calls ‘tax-free’ has to be nasty, and it has to be obfuscated right? Yes exactly that’s what it is.
As we dig into some hints from the Agora Financials ad raving…
“You DON’T Have to Be Rich to benefit “‘Box 8 Dividend’ income checks are easy enough for anybody to collect, even if they’ve got a more modest bank account.”
Allow me to break the ice here! Well, The Box 8 Dividends rant is about our own boring Municipal Bonds which indeed are Federal Tax Free (occasionally you may have to pay taxes depending on your dwelling).
These are indeed closed end Muni Bonds, Muni Bonds by the way are mostly held by individual investors, who want safe and tax-free income, these instruments offer.
Even though there have been a few instances that made muni bond holders nervous, owing to some high profile municipal bankruptcies in the last few years, including Jefferson County, Stockton, LA, and CA. But still the default rate is minimal with Muni Bonds.
Nonetheless Neil George quite obviously is not talking about simple Municipal Bonds here, no matter what your tax bracket is, you seldom earn 10 or 11% tax-equivalent yields from a plain vanilla muni bond.
So what the heck he is pitching here? More cues please…
“Even Better Than 11% Dividends “Not only does this first ‘Box 8′ move offer nearly an 11% equivalent yield, but it also offers gains — just like a stock — and some pretty impressive gains too.
So how do you get to that Magic Figure 10-11% dividends, paid monthly?
With leverage of course, or more precisely there are a bunch of leveraged closed end funds, that do the weight lifting for you, these are run by respectable asset managers that pay their distributions on a once-a-month basis. Neil George is obfuscating it, and is averse to express the three “plays” he is recommending in this tease.
Of course if you have a willingness to subscribe to Neil George’s ideas you are buying his abilities as a investment manager to manage the portfolio for interest-rate risk, and income. However the “Box 8 Dividends” is Mumbo Jumbo and promotional hype to get you interested.
Update 26 November 2013:
Well, it seems to me they are touting America’s First Tax Exempt (ATAX) it’s a no brainer investment. They are based in Omaha, run by experienced managers who have invested their own money in it. They invest in and manage city sponsored housing apartments. Not very much profitable but they have a very nice cash flow. Traded on NYSE at about $6.50 per unit where the yield is about 7.5%.
I still say it’s very good for folks who aren’t sure what to do with their money after all they are asking you $39 for all the research. I must tell you Neil George’s newsletter could not be written off as a scam by any standard.
But I really botched to figure out the Rationale behind the catchphrase ‘The Box 8 Dividends ‘in this ceaseless sales pitch. It’s your Money and it must be your Call. The CEFconnect web site offers insights at this and is of some help.