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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

3,499 Comments

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Dec 13, 2021
2,837 Posts
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Dec 13, 2021
keung
Dec 13, 2021
2,837 Posts

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


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.
I am sure you know your Math but the least you can do is to do little research on the subject before going all over the place and give out mis information.

It is VERY unlikely to go to 0.1%

The bonds reset the rate on May 1 2022, and we already have 2 months reference
Sept/Oct 2021 change is 0.83%
Oct/Nov 2021 change is 0.49%
2 months in we have a change of Sept-Nov 1.33% which annualize to 2.66%

If the rest of the 4 months we have 0% inflation you still get 1.33%
We will ASSUME the inflation is ZERO for the next 4 months so you get
10K @3.56% 6 months = $356
10K @ 1.33% 3 months = $76.5
Total interest with penalty = 432.5
It is al least 4%+ interest for 12 months if you factor in 3 months penalty and assume that the next 4 months has 0% inflation. Now let me know where can I get a 1 year 4% CD

No one say iBond it is the best investment in the world but it is a very safe investment

1. Credit agency rated US government AAA rating, this is the best rating any country can get.

2. A 2 years US treasury give you @ 0.632%, so 4% is like 6X more return

3. I have not see any CD give me more than 4% return the last 5 year have you?

Yes, people said you can do CC Bonus, Bank Bonus, everything else to 4% interest sure I do all that too, I rake in few thousands each year on those, but why do I still buy iBond? Because I don't need to do anything and it give me 4%!!
Last edited by keung December 13, 2021 at 02:38 PM.
1
Dec 13, 2021
1,183 Posts
Joined Mar 2005
Dec 13, 2021
acegolfer
Dec 13, 2021
1,183 Posts
Quote from Honest-IJM :
Check out these charts based on the older methods of calculating CPI:
http://www.shadowstats.com/altern...ion-charts
FYI, Boskin Commission (1995) found that the old methodology (1990 in your link) overestimated the inflation rate, which resulted in higher federal budget and contributed to bigger budget deficit.

https://en.wikipedia.org/wiki/Boskin_Commission
Dec 13, 2021
2,934 Posts
Joined Dec 2012
Dec 13, 2021
MMPG
Dec 13, 2021
2,934 Posts
Can someone explain this to me like I'm 5 years old?
So if I put in $10k and after a year it will be worth $10,712?
Dec 13, 2021
12,291 Posts
Joined Jan 2009
Dec 13, 2021
teaberry
Dec 13, 2021
12,291 Posts
Thanks guys, was looking for some inflation hedge for the emergency cash sitting in super low APY accts. Seems like a solid place to put some $ .

The $10k max isn't just for a household (married joint file)? Each individual of 18+ I assume can open an acct and buy $10k now and another $10k in Jan 2022?
Dec 13, 2021
1,183 Posts
Joined Mar 2005
Dec 13, 2021
acegolfer
Dec 13, 2021
1,183 Posts
Quote from Diz :
Logic doesn't make sense to retards. Don't waste your bandwidth trying to explain common sense.
keung's math is correct.
Dec 13, 2021
1,183 Posts
Joined Mar 2005
Dec 13, 2021
acegolfer
Dec 13, 2021
1,183 Posts
Quote from MMPG :
Can someone explain this to me like I'm 5 years old?
So if I put in $10k and after a year it will be worth $10,712?
No because we don't know what the next 6 month rate is. You earn half of 7.12% in the 1st 6 month. Next 6 month rate will be determined on 4/12/2022. Could be higher or lower than 7.12%. Nobody knows.

Read keung's calculation above. He shows the correct math (minus one minor mistake).
Last edited by acegolfer December 13, 2021 at 02:43 PM.
Dec 13, 2021
920 Posts
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Dec 13, 2021
mikeyeastside
Dec 13, 2021
920 Posts
Plus compounding

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Dec 13, 2021
1,799 Posts
Joined Dec 2006
Dec 13, 2021
supa2001
Dec 13, 2021
1,799 Posts
Quote from keung :


It is VERY unlikely to go to 0.1%
The bonds reset the rate on May 1 2022, and we already have 2 months reference
Sept/Oct 2021 change is 0.83%
Oct/Nov 2021 change is 0.49%
2 months in we have a change of Sept-Nov 1.33% which annualize to 2.66%
If the rest of the 4 months we have 0% inflation you still get 1.33%
We will ASSUME the inflation is ZERO for the next 4 months so you get
10K @3.56% 6 months = $356
10K @ 1.33% 3 months = $76.5
Total interest with penalty = 432.5
It is al least 4%+ interest for 12 months if you factor in 3 months penalty and assume that the next 4 months has 0% inflation. Now let me know where can I get a 1 year 4% CD
So you're saying it's better to keep it for a year and then withdraw?
Dec 13, 2021
1,183 Posts
Joined Mar 2005
Dec 13, 2021
acegolfer
Dec 13, 2021
1,183 Posts
Quote from keung :


It is VERY unlikely to go to 0.1%
The bonds reset the rate on May 1 2022, and we already have 2 months reference
Sept/Oct 2021 change is 0.83%
Oct/Nov 2021 change is 0.49%
2 months in we have a change of Sept-Nov 1.33% which annualize to 2.66%
If the rest of the 4 months we have 0% inflation you still get 1.33%
We will ASSUME the inflation is ZERO for the next 4 months so you get
10K @3.56% 6 months = $356
10K @ 1.33% 3 months = $76.5
Total interest with penalty = 432.5
It is al least 4%+ interest for 12 months if you factor in 3 months penalty and assume that the next 4 months has 0% inflation. Now let me know where can I get a 1 year 4% CD
99% correct. One nit pick. The i-bonds are compounded semiannually. The interest income in the 2nd 6 months is equal to 10356 * 1.33% = $137.74. Subtract 3 month penalty, equal to $68.87.
Dec 13, 2021
708 Posts
Joined Jan 2008
Dec 13, 2021
Diz
Dec 13, 2021
708 Posts
Quote from acegolfer :
keung's math is correct.
Yes, it is.
Dec 13, 2021
2,837 Posts
Joined Jul 2009
Dec 13, 2021
keung
Dec 13, 2021
2,837 Posts
Quote from supa2001 :
So you're saying it's better to keep it for a year and then withdraw?
You need to keep it for at least a year. you can keep it longer all depend on whether you are happy with the future interest rate. If there a better alternative of course you can take the 3 months penalty and withdraw after a year
Dec 13, 2021
840 Posts
Joined Oct 2005
Dec 13, 2021
imapixie
Dec 13, 2021
840 Posts
For those of you who have done this, are you buying 10k worth in different chunks? Like should I do a couple $2,500 ones and a 5k one? Or….?
Dec 13, 2021
1,183 Posts
Joined Mar 2005
Dec 13, 2021
acegolfer
Dec 13, 2021
1,183 Posts
Quote from imapixie :
For those of you who have done this, are you buying 10k worth in different chunks? Like should I do a couple $2,500 ones and a 5k one? Or….?
Either way is fine. I bought all $10k lumpsum because I can partially redeem later. I rather have 1 line in my TD account.
Dec 13, 2021
365 Posts
Joined Jul 2009
Dec 13, 2021
EricPost
Dec 13, 2021
365 Posts
Tthe government just said they are changing the way they calculate inflation starting in 2022
Quote :
Starting in January 2022, weights for the Consumer Price Index will be calculated based on consumer expenditure data from 2019-2020.
How will this effect it?

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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 EricPost :
Tthe government just said they are changing the way they calculate inflation starting in 2022

How will this effect it?
For anyone thinking of some conspiracy theory, this is not. BLS regularly updates the basket to reflect true consumption behavior. For more see, https://www.bls.gov/cpi/questions...nswers.htm
Dec 13, 2021
1,183 Posts
Joined Mar 2005
Dec 13, 2021
acegolfer
Dec 13, 2021
1,183 Posts
delete. duplicate

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