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?
- Must register or sign-in to your free TreasuryDirect.gov account and link a bank account.
- Click here to view a Guided Tour
- 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%
Top Comments
In case you're wondering, here's how the rate is computed:
Composite rate =
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.
https://www.treasurydir
3,498 Comments
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What I saw is: 7.12 is good for six months.
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You buy a bond for $10K. The day after you buy your bond inflation drops to 0% and stays there for the entire remainder of the year.. You cash the bond at exactly one year and pay the 3 month penalty. You will be getting no additional interest for the second half of the year since the rate reset to 0%. You will lose 0% due to the penalty. Your $10K will now be worth (slightly more with compounding) $10,365. That is 6 months at 7.12% APR and 6 months at 0%.
The best 6 month CD right now pays 0.75%, so $10K would earn a little over $37 for the 6 months. After 6 months you would need to find another 6 month CD that is paying around 6.5% to earn as much as the I bond paid. Interest rates NEVER move that fast.
The bottom line is that I Bonds are the best game in town for cash holdings. Even in the worst case, they beat CDs and savings accounts by a long shot. If you have a emergency fund, put a portion of it in these bonds. If you have cash that you don't want to risk in the market, buy these bonds. Don't worry about the penalty or having to hold for 5 years. Don't worry about the interest rate reset after 6 months; it does not matter. After the first year and every 6 months after that, look at the current inflation rate the bonds are paying. If you can get a better safe interest rate, sell the bonds and move on. Keep in mind that these bonds are exempt from state and local taxes. Savings accounts and CDs are not. To get the same rate after taxes you will need need a higher CD rate than the I Bonds if you pay state taxes.
And yes, the Treasury Direct website sucks.
Edit: finally got connected and they told me they have no idea why this would happen and they can't do anything about it but someone will call me back, hopefully within 2-3 days. Not expecting that to happen.
That's a scary survey.
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That's a scary survey.
I know that it can be difficult to make ends meet in these difficult times, but there is always somewhere you can cut to do a little saving. An emergency fund is SO important. A very long time ago when I first began my career, I was unable to meet all my my expenses without working overtime. I played all the games to save money and everything was very close to being negative at the end of the month. It took effort, but even if it was only $20, I would put something in savings. Eventually, you get a raise in your wages. You need the strength to put that additional income toward savings. You were getting by on your previous wages, so why can't you still do it? Over time the saving can really stack up and you will be financially secure some day.
If you have money sitting in cash (or money market account, or savings account) that you won't need within the next year then this is a better alternative.
If you are investing for the long term (5+ years) then an S&P or total market index fund is a better choice.
If you are interested at crypto then there are lots of options with varying levels of risks and returns. YouTube is awash with information/bs but tldr; the odds are very much against finding another Bitcoin. There may be other opportunities but knowledge is power and if you can't put in the (lot of) effort to understand wtf it's all about you are best to stay out of it.