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New I-Bond Rates – 1.0% Fixed, 2.85% Inflation
Posted By Jim On 11/01/2005 @ 10:11 am In Government,Investing,Personal Finance | 2 Comments
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))
Fix: Erroneously wrote 1.2% fixed when it’s really 1.0%. Thanks Jonathan.
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