I urge you to take a look at the next three fixed income asset classes as they offer an opportunity for adding income to a portfolio.

Municipal Bonds

A municipal bond is a pledge or agreement that an issuer (states, cities, counties, school districts, government agencies and authorities) makes to the holder of the bond to pay a fixed sum of money on a defined date at a fixed rate of interest.

On the scale of risk municipal bonds are usually one of the safer investment type.  Similar to the federal government if a city needs additional money to pay it's bondholders it can raise the taxes on citizens of the city.

Two reasons municipal bonds are attractive:

1. Depending on where you buy them and where you reside, they can be exempt from federal, state, and local taxes.  For example, if you reside in NJ and found a NJ municipal bond yielding 4.5%, it's taxable equivalent bond would have to yield 7.45%.  (This is based on the assumption that you are in the 35% tax bracket.)
   

2. Spreads between the yields of municipal bonds and treasuries has usually been relatively close with historically munis yielding approximately 90% of treasuries.  Currently munis are yielding 130%-150% more than treasuries.

Treasury Inflation Protected Securities

The US Government's actions geared towards stimulating the economy most likely will have the effect of leading to inflation.  Inflation can do a lot of damage to a portfolio, therefore it would be wise to factor it into your financial planning.

Treasury Inflation-Protected Securities (TIPS), are one of the few investments that provides a direct inflation hedge against things like food, housing, and healthcare.  As inflation increases, the principal value of the bonds is adjusted upward, based on changes in the Consumer Price Index (CPI).  TIPS receive periodic coupon payments at fixed interest rates like most bonds, but unlike other bonds, those payments are based on an increasing principal value in an inflationary environment.

Preferred Stocks

If you are a little hesitant about putting your money through the common stock tornado you may want to look into investing in the preferred stock of a company.  Preferred shares yield a much higher dividend than common stocks and also trade like a bond, as it has fewer big price swings up or down.

While a lot of companies in distress have been cutting their common dividend they have been leaving their preferred dividends alone, you are still at risk if the company goes bankrupt.  This is why it makes sense to buy these in a basket with an ETF.  Some Preferred ETF's are currently yielding over 10%.

Munis, TIPS, and Preferreds offer a good opportunity to add income to a portfolio.  There is risk associated with each of these asset classes; therefore they are not right for everyone.