I'm trying to help someone out that is actually of "traditional" retirement age and I was hoping you could help me out. Like I said, he's a bit older and is totally invested in bonds (munis and taxable) at this point of his life but I've realized that the music is going to stop/has already stopped so I'm trying to think of different income solutions. Lending Club seems like a great solution as it would provide him with a steady source of income.
My only question is regarding taxes because this would be held in a taxable account and from what I understand wouldn't be treated as a simple capital gain but as ordinary income instead, correct? If he's already in retirement, and doesn't have any income would this actually be a positive for him since his tax rate would be only 10%?
Also, I'm not sure how this works but would it make sense for him to open an IRA at this point? If so, is it too late to open an account and get in a 2012 contribution with the deadline coming on Monday?