Subscribe
Home Craft Why You Should Buy Series I Bonds Right Now

Why You Should Buy Series I Bonds Right Now

by Staff
0 comment

Photo: Jonathan Weiss (Shutterstock)

As inflation soars to the highest rate since 1981, you’ve very likely noticed how much it’s affecting the cost of many of your day-to-day necessities. But even beyond your checkbook and credit card statements, inflation is eating away at the purchasing power of the money you have parked in a savings account. One solution: U.S. government Series I savings bonds.

To start, here’s a little primer on bonds, as we’ve covered in the past:

When you buy a bond, you’re basically buying a debt and loaning a company (or government) money. Instead of investing in the company itself, you give them money and they agree to pay you interest. This interest is called a “coupon,” and it’s paid at a set rate and schedule. The bond also comes with a maturity date: the date the issuer has to repay the amount they borrow. You can also sell your bond before the maturity date. Depending on what interest rates look like when you sell, you might get more or less than what you paid.

That interest rate you earn is known as the composite rate, and it’s re-evaluated every six months in May and November to reflect inflation. If you buy the bonds before Oct. 28, you will lock in the current interest rate of 9.62% for the first six months. The following six months is expected to be 6.84% (still good but not as good), but that will be confirmed by the U.S. Treasury on Nov. 1. You can buy a maximum amount of $10,000 for this calendar year.

How do Series I bonds work?

You have to hold the bonds for at least a year before cashing out, and if you cash out before five years, the last three months of interest will be the penalty due for cashing out early. But even if you give up your last three months of earning, your money will grow more than if it just sat in a savings account.

The only place to buy them is the U.S. Treasury website. It takes roughly 10 minutes to create an account, and you must have a Social Security Number and either be a U.S. citizen, resident, or civilian employee working for the U.S. government to be eligible. When creating the account, unless you have a business or trust, pick the “individual account” option, and fill out your personal information with your bank account that your funds will be drawn from. For the rest of the process, follow this step-by-step video explainer that walks you through buying the bonds.

Should I buy I bonds?

Series I bonds are a great alternative for those people with savings in the bank who do not need the money for at least a year. Even if you take out the money in a year and are penalized for three months’ worth of interest, you end up with more returns than if you left it in your bank account. But as good as these bonds sound, they’re not for everyone. You should not buy Series I bonds if you plan to use the money within the initial 12 months. This also means you shouldn’t buy them with your emergency fund money or take out money from credit cards to buy them.

   

Read the full article here

SaleBestseller No. 1
Apple AirPods Max Wireless Over-Ear Headphones. Active Noise Cancelling, Transparency Mode, Spatial Audio, Digital Crown for Volume Control. Bluetooth Headphones for iPhone - Green
Apple AirPods Max Wireless Over-Ear Headphones. Active Noise Cancelling, Transparency Mode, Spatial Audio, Digital Crown for Volume Control. Bluetooth Headphones for iPhone - Green
 Apple-designed dynamic driver provides high-fidelity audio; Active Noise Cancellation blocks outside noise, so you can immerse yourself in music
$449.99
Bestseller No. 3
Apple iPad Air 2, 64 GB, Space Gray (Renewed)
Apple iPad Air 2, 64 GB, Space Gray (Renewed)
Apple iOS 8; 9.7-Inch Retina Display; 2048x1536 Resolution; A8X Chip with 64-bit Architecture; M8 Motion Coprocessor
$185.00
SaleBestseller No. 4
2021 Apple 10.2-inch iPad (Wi-Fi, 64GB) - Silver
2021 Apple 10.2-inch iPad (Wi-Fi, 64GB) - Silver
Gorgeous 10.2-inch Retina display with True Tone; A13 Bionic chip with Neural Engine; 8MP Wide back camera, 12MP Ultra Wide front camera with Center Stage
$269.99
Bestseller No. 5
2022 Apple TV 4K Wi‑Fi with 64GB Storage (3rd Generation)
2022 Apple TV 4K Wi‑Fi with 64GB Storage (3rd Generation)
4K Dolby Vision and HDR10+ for vivid picture quality; Dolby Atmos for three-dimensional, theater-like sound
$123.49
Bestseller No. 7
Apple AirTag 4 Pack
Apple AirTag 4 Pack
Keep track of and find your items alongside friends and devices in the Find My app; Simple one-tap setup instantly connects AirTag with your iPhone or iPad
$94.98
Bestseller No. 8
Apple MacBook Air with Intel Core i5, 1.6GHz, (13-inch, 4GB,128GB SSD) - Silver (Renewed)
Apple MacBook Air with Intel Core i5, 1.6GHz, (13-inch, 4GB,128GB SSD) - Silver (Renewed)
1.6 GHz dual-core Intel Core i5 (Turbo Boost up to 2.7 GHz) with 3 MB shared L3 cache; 13.3-Inch (diagonal) LED-backlit Glossy Widescreen Display, 1440 x 900 resolution
$299.99
Bestseller No. 9
Apple Of My Eye
Apple Of My Eye
Amazon Prime Video (Video on Demand); Amy Smart, Burt Reynolds, Liam McIntyre (Actors); Castille Landon (Director) - Castille Landon (Writer) - Dori A. Rath (Producer)
$3.99
SaleBestseller No. 10
Apple 35W Dual USB-C Port Compact Power Adapter ​​​​​​​
Apple 35W Dual USB-C Port Compact Power Adapter ​​​​​​​
The compact size and folding prongs make it easy to pack and store.; Charging cable sold separately.
$52.00

You may also like

Leave a Comment

Iman Hearts is one of the biggest lifestyle news and articles portals, we provide the latest news and articles about family, lifestyle, entertainment, and many more, follow us to get the latest news about what matters to you.

 

© 2022 Iman Hearts. All rights reserved. Sitemap