It's important to have your investments diversified

Many middle Class people have their home as their only investment. This may or may not be a good idea if you look back at what happened to people from around 2006 to 2012 here in the U.S. So, a diversified set of investments usually will see you through most problems the U.S. and world might face.

To only have your investments in one thing, whether that be a house, a single stock or even one mutual fund can leave you vulnerable in different types of situations that can arise in life. So, finding a way to diversify and to do the research necessary to see how that investment has done for the last 10 or 20 years will tend to stand you in good stead.

Regarding Tax Free Muni Bonds, this was how most people who fared the best through the Great Depression were invested. First you pay no taxes because you are funding municipal projects like schools, colleges, water and sewage systems nationwide. So, you don't pay taxes on these investments because you are helping everyone at a local level and this encourages you to make these investments. However, the problem with these investments lately is that it is a very low interest rate you are receiving on these investments. But, not paying any taxes needs to be weighed against the low interest rates. Also, lately since around 2009 cities sometimes are going bankrupt and it is possible now to lose your principle of your investment if it is not insured with Treasuries for example. So, be very careful how you invest in Muni Bonds and do research regarding the financial state of the municipality and whether they are insured to prevent you from losing your principle.

Investment counselors usually recommend a 40% to 60% balance between Municipal Bonds and stocks, especially for older investors who need more stability in their investments. The municipal bonds will stay at about the same value usually even if there is a stock market crash of some sort.

So, having this 40% tax free municipal bonds and 60% stocks in your investment portfolio is a way to not be "Completely wiped out" if another 1929 crash occurs in this century. So, preparing for literally ANY eventuality is helpful in the long term planning of every long term investor who are usually middle Class or above in education and investment knowledge.