Maximizing portfolio income

If you're taking a lower salary, you may be in a lower tax bracket, which means that tax-free investments aren't as advantageous. IIRC, high-yield (i.e., junk) bonds aren't paying a huge premium over better-quality bonds right now, so they're not as attractive as an investment either. You might look into decent-quality corporate bonds.

I also happen to like treasuries, but I live in a state (CA) with a high income tax, which makes the tax advantage significant. I happen to like intermediate term bonds now. There's too much uncertainty about interest rates for me to go long-term.

-Jim

This question may be better answered at misc.invest.financial-plan.

I assume that there will be "some" earned income to support such contributions?

Your main goal should be to maximize your after-tax income. Tax exempt bond funds may not do that for you, unless your tax bracket is 25% or higher. Short or intermediate term bond funds (taxable) may be a better fit, since you are looking for a secure income stream with low risk. High yield taxable funds, while attractive, come with their own set of risks and returns are not that much better than intermediate term funds.

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