Why do agency debentures matter to investors?
Agency debentures can be a great way to put money into a very safe place for the long term while also earning some regular interest income. They make sense as a balance to riskier investments like tech stocks, which can break your heart if you fill your portfolio with them and have nothing reliable to balance them out.
In addition, agency debentures are tax-exempt (not necessarily fully, with some only exempt from local or state taxes) when issued by government agencies, which can make your interest income a little bit bigger than it appears. You may find that you save significant tax liability by choosing certain agency debentures as part of your tax mitigation plan.
Even if you choose to go with GSE-issued agency debentures, you can still be assured of a relatively stable asset that is perfect for a long-term investing strategy. As always, be aware of the terms of each agency debenture you invest in, and be sure to compare not only the interest but the fees associated with each one.