U.S. Government Treasury is offering
6.89% Interest Rate (Annualized for 6 Months) in combined Fixed + Inflation Rate Earnings valid on newly issued Series I Savings Bonds purchased from
November 2022 through April 2023. Limit of $10,000/year per person (with caveats, see prior thread for details in the discussion).
In layman's terms: These are U.S. treasury securities which adjust their interest rate every 6 months based on the current inflation rate. The calculation is more complex than that but using the CPI-U (Core CPI) from October of 6.6% YoY, an inflation interest rate of 6.47% can be derived based on the previous 6 months of inflation data, and when combined with a fixed interest rate component over which the Fed has discretion and was announced November 1, we now have the finalized rate of 6.89%.
For further details on how I-bonds work, see the previous
Front Page deal when the 9.62% rate was announced. There is plenty of discussion and information there on how I-bonds work.
About this offer:
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:
- 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.
- An I bond earns interest monthly from the first day of the month in the issue date. The interest accrues (is added to the bond) until the bond reaches 30 years or you cash the bond, whichever comes first.
- The interest is compounded semiannually. Every six months from the bond's issue date, interest the bond earned in the six previous months is added to the bond's principal value, creating a new principal value. Interest is then earned on the new principal.
- The composite rate for I bonds issued from May 2022 through October 2022 is 9.62 percent. This rate applies for the first six months you own the bond.
When can I cash my I bonds?- After they are 12 months old.
- If you cash an I bond before it is five years old, you will lose the last three months of interest.
- I bonds earn interest for 30 years if you don't cash the bonds before they mature.
- If you've been affected by a disaster, special provisions may apply.
https://www.treasurydirect.gov/in...s_ibuy.htm 
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