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New I-Bond Rates – 1.0% Fixed, 2.85% Inflation

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I predicted this privately but the new I-Bond rate rose to 6.73% but the fixed component fell from 1.2% to 1.0%, which is the only interesting part of the new rates. What this does mean is that you can get a 6.73% return on an I-Bond and you’re only required to hold it for a single year!

Incidentally the equation for calculating the rate is:
I-Bond Rate = (Fixed Rate + (2 x Inflation Rate) + (Fixed Rate x Inflation Rate))

Open a Treasury Direct account – to buy and redeem bonds entirely online.
Learn more about I-Bonds – remember the data is for the previous 6 months though.

Fix: Erroneously wrote 1.2% fixed when it’s really 1.0%. Thanks Jonathan.

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2 Responses to “New I-Bond Rates – 1.0% Fixed, 2.85% Inflation”

  1. Spike says:

    Keep in mind that if you do hold it for just a single year, you will be penalized 3 months interest for selling it before 5 years…. which brings down the rate down to 5.05%. Still, not a bad deal. I’m going to continue with my regime of buying a $50 i-bond every month.

  2. Jonathan says:

    You mean “New I-Bond Rates – 1.0% Fixed”?

    And the 6.73% is only good for 6 months, after which the variable part will change based on inflation over the next six months.


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