US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest
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https://www.treasurydirect.gov/indiv/research/indepth/ibonds/res_ibonds_ibuy.htm
https://www.youtube.com/watch?app=desktop&v=8pIRjfHv834
You can buy Ebonds $10,000 per year + $5000 paper bonds with your tax refund.
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there are many ins and outs to these bonds. they are great investments if you understand ALL the rules and penalities. (ie, you have to hold them for at least 12 months and if you cash out before 5 years, there’s a 3 month interest penalty)
It is also best to buy the bond at the end of the month (around the 29th to allow 2 days to go through if 31 days) since interest is paid at the end of the month. no benefit to buying on 5/3 vs 5/29 for instance. but allow enough buffer so it’s credited by 5/31.
there is a HUGE thread on SD about these I suggest reading before you purchase so you understand. Some people get shot down with online set up and you have to submit a hard copy form that’s rather a hassle, so be prepared for that ‘issue’.
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Thank you, for adding to the Ibonds!
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I saw that thread on SD and pondered buying some but didn’t get around to it. Glad I waited since the interest rate has increased. Of course, at the same time, this speaks about the inflationary state of the economy, too…
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@yoregano said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
Glad I waited since the interest rate has increased.
I don’t think “glad” is the correct description. If you purchased in April, you would have 6 months of 7.x% and 6 months of 9.x%. Now, you don’t know what happens after 6 months of 9.x%.
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@c3 said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
@yoregano said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
Glad I waited since the interest rate has increased.
I don’t think “glad” is the correct description. If you purchased in April, you would have 6 months of 7.x% and 6 months of 9.x%. Now, you don’t know what happens after 6 months of 9.x%.
Right, that’s correct. Say you bought the 7.x bond in late 2021, you’d earn six months from your month date (say 1/1/22) of 7+%, then on 7/1/22 it goes up to 9.x% To be honest I don’t see inflation coming down much anytime in the next year. Oil prices will be even higher this summer than recently with demand and likely Russian boycott from Europe, supply chain issues from China and elsewhere. Labor costs going up as people demand more money for wages to keep up w/inflation. It’s a bad spiral when it gets like this.
Consider that a money market acct is paying .5% right now. Anything above 4% in these bonds is pretty darn good not to mention the interest hit is deferred until you actually redeem them.
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@yoregano said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
I saw that thread on SD and pondered buying some but didn’t get around to it. Glad I waited since the interest rate has increased. Of course, at the same time, this speaks about the inflationary state of the economy, too…
Yes, I suppose a better way of putting it might be I’m glad the rate didn’t drop. If one has the ability to “tie up” funds, this is a good deal. We’re still back to pondering the effects of inflation though, at the same time.
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@mistercheap said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
@c3 said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
@yoregano said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
Glad I waited since the interest rate has increased.
I don’t think “glad” is the correct description. If you purchased in April, you would have 6 months of 7.x% and 6 months of 9.x%. Now, you don’t know what happens after 6 months of 9.x%.
Right, that’s correct. Say you bought the 7.x bond in late 2021, you’d earn six months from your month date (say 1/1/22) of 7+%, then on 7/1/22 it goes up to 9.x% To be honest I don’t see inflation coming down much anytime in the next year. Oil prices will be even higher this summer than recently with demand and likely Russian boycott from Europe, supply chain issues from China and elsewhere. Labor costs going up as people demand more money for wages to keep up w/inflation. It’s a bad spiral when it gets like this.
Consider that a money market acct is paying .5% right now. Anything above 4% in these bonds is pretty darn good not to mention the interest hit is deferred until you actually redeem them.
Even if you cash out at the end of the first 12 months and forego three months of interest, you’re still way ahead of a savings/mma or CD. I bought in Novenber 2021, and then again in April 2022, So did my wife. Took the money out of a savings account paying around 0.5%. Would be great if we could buy more than $10K per person per year. Not getting a tax refund, so can’t use that to buy a $5K paper iBond on top of the $10K bonds.
– Z –
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@zerenia said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
@mistercheap said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
@c3 said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
@yoregano said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
Glad I waited since the interest rate has increased.
I don’t think “glad” is the correct description. If you purchased in April, you would have 6 months of 7.x% and 6 months of 9.x%. Now, you don’t know what happens after 6 months of 9.x%.
Right, that’s correct. Say you bought the 7.x bond in late 2021, you’d earn six months from your month date (say 1/1/22) of 7+%, then on 7/1/22 it goes up to 9.x% To be honest I don’t see inflation coming down much anytime in the next year. Oil prices will be even higher this summer than recently with demand and likely Russian boycott from Europe, supply chain issues from China and elsewhere. Labor costs going up as people demand more money for wages to keep up w/inflation. It’s a bad spiral when it gets like this.
Consider that a money market acct is paying .5% right now. Anything above 4% in these bonds is pretty darn good not to mention the interest hit is deferred until you actually redeem them.
Even if you cash out at the end of the first 12 months and forego three months of interest, you’re still way ahead of a savings/mma or CD. I bought in Novenber 2021, and then again in April 2022, So did my wife. Took the money out of a savings account paying around 0.5%. Would be great if we could buy more than $10K per person per year. Not getting a tax refund, so can’t use that to buy a $5K paper iBond on top of the $10K bonds.
– Z –
True, but why on earth cash out (unless you really need the $$)?? So you cash out lose 1/4 of your interest if you’ve held the bond for 12 months, to do what with it? Put it back earning .5 % again?
My feeling is, not touching it unless the inflation rate goes so low the bonds are paying next to nothing. if I’m earning 2-3% more on this than a savings acc’t or even a CD, I’m not touching it unless it’s a financial emergency. These would have to go below 3% given present rates for me to even consider an early redemption.
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@mistercheap said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
@zerenia said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
@mistercheap said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
@c3 said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
@yoregano said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
Glad I waited since the interest rate has increased.
I don’t think “glad” is the correct description. If you purchased in April, you would have 6 months of 7.x% and 6 months of 9.x%. Now, you don’t know what happens after 6 months of 9.x%.
Right, that’s correct. Say you bought the 7.x bond in late 2021, you’d earn six months from your month date (say 1/1/22) of 7+%, then on 7/1/22 it goes up to 9.x% To be honest I don’t see inflation coming down much anytime in the next year. Oil prices will be even higher this summer than recently with demand and likely Russian boycott from Europe, supply chain issues from China and elsewhere. Labor costs going up as people demand more money for wages to keep up w/inflation. It’s a bad spiral when it gets like this.
Consider that a money market acct is paying .5% right now. Anything above 4% in these bonds is pretty darn good not to mention the interest hit is deferred until you actually redeem them.
Even if you cash out at the end of the first 12 months and forego three months of interest, you’re still way ahead of a savings/mma or CD. I bought in Novenber 2021, and then again in April 2022, So did my wife. Took the money out of a savings account paying around 0.5%. Would be great if we could buy more than $10K per person per year. Not getting a tax refund, so can’t use that to buy a $5K paper iBond on top of the $10K bonds.
– Z –
True, but why on earth cash out (unless you really need the $$)?? So you cash out lose 1/4 of your interest if you’ve held the bond for 12 months, to do what with it? Put it back earning .5 % again?
My feeling is, not touching it unless the inflation rate goes so low the bonds are paying next to nothing. if I’m earning 2-3% more on this than a savings acc’t or even a CD, I’m not touching it unless it’s a financial emergency. These would have to go below 3% given present rates for me to even consider an early redemption.
Well said Mr C, 100% agree!
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@zerenia said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
Not getting a tax refund, so can’t use that to buy a $5K paper iBond on top of the $10K bonds.
You can always make an estimated payment to force a refund
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Getting paper iBonds with tax refund is a P.I.T.A. They come in seemingly random (and sometimes small) denominations. Then you have to mail in the physical iBonds to convert them into electronic versions… and then they sit in a conversion account which is separate from the other iBonds that are purchased on TreasuryDirect.
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My Federal Tax refund was used to buy Ibonds, but I only could buy electronic Bonds!
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@marvomatic said in US Treasury Series I Savings Bonds Inflation Rate Earnings (May - October '22) 9.62% Interest:
My Federal Tax refund was used to buy Ibonds, but I only could buy electronic Bonds!
What do you mean? With the tax refund you get paper bonds.
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I could only buy electronic bonds, with my tax refund. Paper bonds were were nixed out!
