Ask Mary Beth: Money Q & A

What is the advantage of junk bonds?

Mary Beth answers:
Junk bonds offer higher returns but carry a lower rating than most municipal and corporate bonds because there are high risks. Personally, junk bonds are too risky for my taste. They should be used for discretionary funds only--assuming you have an iron stomach and low blood pressure. But they can pay off big--if you are willing to take the risk.