If you buy a municipal bond from your state you can also avoid state income tax. The yield is usually lower compared to other bonds because of the tax-free benefits. If you are in a higher tax bracket, that may be an important benefit and factor in your financial planning. It is also a good idea to get insurance when you buy a zero coupon bond since the interest is not being paid to you. If the bond defaulted, you would receive absolutely nothing without insurance.
Bonds are an important part of every financial portfolio.
Take some time to learn the fundamentals and then include them in your financial plan. There's even a free weekly email newsletter. All rights reserved unless specifically noted. All advice should be weighed against your own abilities and circumstances and applied accordingly. It is up to the reader to determine if advice is safe and suitable for their own situation.