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expired Posted by dn90003 • Dec 12, 2021
expired Posted by dn90003 • Dec 12, 2021

US Treasury Series I Savings Bonds Inflation Rate Earnings (Nov '21 - April '22)

(Limit $10K/Year Per Person)

7.12% Interest

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Note: This popular deal is still available.

U.S, Government Treasury is currently offering 7.12% Interest Rate in combined Fixed + Inflation Rate Earnings valid on newly issued Series I Savings Bonds purchased from November 2021 through April 2022. Limit of $10,000 / year in interest earnings per person.

Thanks to community member dn90003 for sharing this offer.

About this offer:
  • How do I buy a Series I bond?
  • What is a Series I bond? (source)
  • "A savings bond that earns interest based on combining a fixed rate and an inflation rate."
  • You may use Series I bonds to:
    • Save in a low-risk product that helps protect your savings from inflation
    • Supplement your retirement income
    • Give as a gift
    • Pay for education
    • Click here for more information about Series I Bonds
  • What interest does a Series I bond earn? (source)
    • A combination of a fixed rate that stays the same for the life of the bond and an inflation rate that is set twice a year.
    • For bonds issued from November 2021 through April 2022, the combined rate is 7.12%

Editor's Notes

Written by BostonGirl
Refer to the forum thread here for more information and details.

Original Post

Written by dn90003
Community Notes
About the Poster
Deal Details
Community Notes
About the Poster
Note: This popular deal is still available.

U.S, Government Treasury is currently offering 7.12% Interest Rate in combined Fixed + Inflation Rate Earnings valid on newly issued Series I Savings Bonds purchased from November 2021 through April 2022. Limit of $10,000 / year in interest earnings per person.

Thanks to community member dn90003 for sharing this offer.

About this offer:
  • How do I buy a Series I bond?
  • What is a Series I bond? (source)
  • "A savings bond that earns interest based on combining a fixed rate and an inflation rate."
  • You may use Series I bonds to:
    • Save in a low-risk product that helps protect your savings from inflation
    • Supplement your retirement income
    • Give as a gift
    • Pay for education
    • Click here for more information about Series I Bonds
  • What interest does a Series I bond earn? (source)
    • A combination of a fixed rate that stays the same for the life of the bond and an inflation rate that is set twice a year.
    • For bonds issued from November 2021 through April 2022, the combined rate is 7.12%

Editor's Notes

Written by BostonGirl
Refer to the forum thread here for more information and details.

Original Post

Written by dn90003

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Top Comments

Looks tempting. But these are only rated for inflation as fixed rate is 0%. Once inflation is back down, your rate will go down with it.
In case you're wondering, here's how the rate is computed:
Composite rate =
No, these are govt bonds. They stay in the treasury. I bonds are based on the rate of inflation. They have a fixed rate plus the current rate of inflation. Inflation goes up, you earn more. It was 3.54%. Rates went up on 11/1. To realize the full benefit you need to buy before the rates change on 5/1 and 11/1. No fees or penalties. Hold for a min.of a year. If you cash out in less than 5 years you forfeit 3 months interest. After 5 years, you don't pay anything. You can only buy $10k/yr and then up to an additional $5k if purchased directly from your tax refund.
I bought $10k in denominations of 2,3, 5 so if I want to cash out I can do it in chunks instead of having to cash out $10k.: Better than any CD or bank rate if you want to stay in cash.
By the way, using your tax refund to purchase bonds won't count toward your $10k yearly limit.

https://www.treasurydirect.gov/in...eature.htm

3,498 Comments

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Dec 13, 2021
1,183 Posts
Joined Mar 2005
Dec 13, 2021
acegolfer
Dec 13, 2021
1,183 Posts
Quote from HilariousRecess268 :
Keep in mind that CPI is a year-over-year percentage. You are not seeing 5% one month after the next. For example if CPI was 12%, that would be an average of 1% a month for the past 12 months. Don't even get me started about all the games they play to fudge the CPI.
FYI, The last 2 months, month-to-month CPI-U increase has been 0.9% and 0.8%.
https://www.bls.gov/news.release/cpi.nr0.htm
Dec 13, 2021
2,184 Posts
Joined Aug 2014
Dec 13, 2021
Cmurphy16
Dec 13, 2021
2,184 Posts
Quote from HilariousRecess268 :
Keep in mind that CPI is a year-over-year percentage. You are not seeing 5% one month after the next. For example if CPI was 12%, that would be an average of 1% a month for the past 12 months. Don't even get me started about all the games they play to fudge the CPI.
I know that. I was responding to the poster that said it was still reporting under 5% which is was prior to July. Currently I think they're at 6.8, which got the i bond up so high.
Dec 13, 2021
234 Posts
Joined Jan 2021
Dec 13, 2021
HilariousRecess268
Dec 13, 2021
234 Posts
Quote :
Quote from acegolfer :
FYI, The last 2 months, month-to-month CPI-U increase has been 0.9% and 0.8%.
https://www.bls.gov/news.release/cpi.nr0.htm
I am aware of that. The 12% was just an example that should have been easier to understand for people that are not clear on how year-over-year works in CPI.
Dec 13, 2021
1,183 Posts
Joined Mar 2005
Dec 13, 2021
acegolfer
Dec 13, 2021
1,183 Posts
Quote from Cmurphy16 :
I know that. I was responding to the poster that said it was still reporting under 5% which is was prior to July. Currently I think they're at 6.8, which got the i bond up so high.
FYI, the current 7.12% I-bond rate was decided by 9/2021 CPI-U release. https://www.bls.gov/news.release/...132021.htm

At that time, yoy inflation rate was 5.4%. Otoh, it increased to 6.8% in 11/2021 release. If this continues (not speculating), we may have more than 7.12% rate next May.
Dec 13, 2021
850 Posts
Joined Aug 2013
Dec 13, 2021
LwdshB
Dec 13, 2021
850 Posts
Yeah.... no thanks I'll stick to bitcoin......
3
Dec 13, 2021
218 Posts
Joined Oct 2015
Dec 13, 2021
itsallaboutthemusic
Dec 13, 2021
218 Posts
Quote from practicalme :
That printing out forms and such are for converting paper bonds I think. Cashing out electronic bonds is as simple as buying them.
its possible youre correct, but i havent heard the process from anyone who has actually cashed out.
this is the quote from the site: "Log in to TreasuryDirect and use the link for cashing securities in ManageDirect." no further instructions, and im not willing to waste time logging in, which is a hassle in itself.
1
Dec 13, 2021
6,660 Posts
Joined Mar 2004
Dec 13, 2021
practicalme
Dec 13, 2021
6,660 Posts

Our community has rated this post as helpful. If you agree, why not thank practicalme

Quote from itsallaboutthemusic :
its possible youre correct, but i havent heard the process from anyone who has actually cashed out.
this is the quote from the site: "Log in to TreasuryDirect and use the link for cashing securities in ManageDirect." no further instructions, and im not willing to waste time logging in, which is a hassle in itself.

How do I redeem savings bonds being held in my TreasuryDirect account?

Note: United States Savings Bonds must be held for a minimum of one year from their issue date before they are eligible to be redeemed.

Log into your primary TreasuryDirect® account.
Click the ManageDirect® tab at the top of the page.
Under the heading Manage My Securities, click "Redeem securities".
On the Redemption page, choose the button beside the security type you want to redeem and click "Submit".
On the Summary page, check the box beside each security that you want to redeem and click "Select". You may select up to 50 securities per redemption transaction.
The process from here differs depending on whether you have selected one or more than one security for redemption:
If more than one security was selected for redemption, you will see the Multiple Redemption Request page. If redeeming more than one security, the full amount must be redeemed to the same financial institution.
If only one security was selected for redemption, you will see the Redemption Request page. On this page, either leave the default button selected for Redeem full amount or select the button for Redeem partial amount and enter the desired amount. (Note: In a partial redemption, you must redeem at least $25 and leave a value of $25 in the security.)
From the drop-down box, select the destination (bank account or C of I) you would like to credit with the proceeds.
Click "Review" on the Redemption Request or the Multiple Redemption Request page.
The Redemption Review or Multiple Redemption Review page is then displayed. If any information needs to be changed, click "Edit" and make the changes. Otherwise, click "Submit".
A Redemption Confirmation or Multiple Redemption Confirmation page will be displayed to signify completion of the request. You may wish to print a copy of this page for your records.
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Dec 13, 2021
393 Posts
Joined Mar 2016
Dec 13, 2021
cwel
Dec 13, 2021
393 Posts
Quote from HilariousRecess268 :
I Bonds have been around since the 90's and have always been tied to CPI-U, This is not a "special deal" to grab your money. Only reason the rate is so high now is that CPI-U (because of inflation) is high. The true crime is that the fixed rate is 0% right now because of the fed funds rate being 0%.

The bonds I bought in 2003 are paying 1.1% fixed on top of the inflation rate of 7.12%, so 8.32%. I never intended to hold the 2003 bonds this long. They were attractive because CD rates were so low and the treasury would let you buy them with a cash back credit card and no additional fee. Getting 2% cash back up front made them much better than any CD at the time. Rates have never gone back up enough to justify selling them.
How to add a credit card as one of the source of funds -- I was only able to add a bank account. Also does one have to resend IRS FORM 8888 with $5k purchase of the I bond separately from the online purchase? Can one purchase the $5k using the tax refund online?
Dec 13, 2021
6,660 Posts
Joined Mar 2004
Dec 13, 2021
practicalme
Dec 13, 2021
6,660 Posts
Quote from cwel :
How to add a credit card as one of the source of funds -- I was only able to add a bank account. Also does one have to resend IRS FORM 8888 with $5k purchase of the I bond separately from the online purchase? Can one purchase the $5k using the tax refund online?
The credit card option is long gone.

When you file your 2021 taxes and have a refund, you file the form with your return to have the refund processed as bonds.
Dec 13, 2021
1,073 Posts
Joined Dec 2007
Dec 13, 2021
malibuxboy
Dec 13, 2021
1,073 Posts
delete
Last edited by malibuxboy December 13, 2021 at 01:25 PM.
Dec 13, 2021
3 Posts
Joined Apr 2019
Dec 13, 2021
HappyGorilla380
Dec 13, 2021
3 Posts
Quote from webbiedo :
No, these are govt bonds. They stay in the treasury. I bonds are based on the rate of inflation. They have a fixed rate plus the current rate of inflation. Inflation goes up, you earn more. It was 3.54%. Rates went up on 11/1. To realize the full benefit you need to buy before the rates change on 5/1 and 11/1. No fees or penalties. Hold for a min.of a year. If you cash out in less than 5 years you forfeit 3 months interest. After 5 years, you don't pay anything. You can only buy $10k/yr and then up to an additional $5k if purchased directly from your tax refund.
I bought $10k in denominations of 2,3, 5 so if I want to cash out I can do it in chunks instead of having to cash out $10k.: Better than any CD or bank rate if you want to stay in cash.
Quote from Nattefrost :
That's what my cpa told me last month..good info here
Where did you see the 3 month interest penaly?
Dec 13, 2021
4,031 Posts
Joined Nov 2011
Dec 13, 2021
Eltorito
Dec 13, 2021
4,031 Posts
Quote from malibuxboy :
delete
People don't realize how important is having an emergency fund until they need one, and by then, it's too late.
Pro
Dec 13, 2021
8,873 Posts
Joined Jul 2006
Dec 13, 2021
Nattefrost
Pro
Dec 13, 2021
8,873 Posts
Quote from HappyGorilla380 :
Where did you see the 3 month interest penaly?
When can I cash (redeem) an I bond if I need the money?
You can cash your Series I bonds any time after 12 months. You receive the original purchase price plus interest earnings. I bonds are meant to be longer-term investments; if you redeem an I bond within the first 5 years, you'll lose your last 3 months interest. For example, if you redeem an I bond after 18 months, you'll receive the first 15 months of interest.

https://www.treasurydirect.gov/in...s_ifaq.htm
Dec 13, 2021
132 Posts
Joined Oct 2011
Dec 13, 2021
17judge
Dec 13, 2021
132 Posts
You need to hold the ibonds for a year before cashing them in. Your math is wrong. Lets say the interest rate for next 6 months is .1%. Your total return after a year is greater than $356. Try your math lesson again and show your work. Smilie

Quote from SlickCrowd6832 :
You may need a math lesson..

And it most likely will drop to .1% not 1%... WOW.

Now for your math lesson.

$10K @6 months = $356
Less: 3 months of interest... $178.

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QA
Dec 13, 2021
872 Posts
Joined Mar 2005
Dec 13, 2021
EZ_slickdealz
QA
Dec 13, 2021
872 Posts
Quote from Eltorito :
People don't realize how important is having an emergency fund until they need one, and by then, it's too late.
Yep. We're not wealthy but having $20k in these bonds ($10k in Oct. and $10k after the 1st of the year) beats having it in a savings account or CD. I know it isn't quite as accessible as other options but after a year it's close enough. We'll have another small reserve in the savings account to hold us over if something were to happen in the meantime.

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