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The bonds issued by US government agencies and US government sponsored enterprises refer to bonds issued by Ginnie Mae, Fannie Me and Freddie Mac, which play an important role in ensuring that mortgages are available to thousands of Americans so that they can purchase their own homes. These mortgages are funded through bonds and the bonds are quite popular because they have high credit ratings.
A low risk and high return government bond type is the US Treasury bond. Like all other government bonds, the US Treasury bond is backed by full faith and credit of the US government and you are guaranteed that you will get your money back unless the US government goes bankrupt. The chances of the government going bankrupt are negligible.
Treasury bonds are long term bonds with maturity date ranging from 10 years to 30 years. You earn a higher rate of interest compared to other government bonds and you will receive the interest every six months. The best part is that the interest amount is exempt from state and local income tax but you will have report the earnings in your federal tax return. You can also sell Treasury bonds before the date of maturity and if you make money through the sale, nothing like it.
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