CAJUNLAWYER
Member
If you buy an I series bond up to 10k per person before the end of October they are paying 9.62% Beats the hell out of CD's and for now the market. Can buy up to 10k for each SSN
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I series bonds
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DWalt
Member
True, but:
They mist be held for at least one year, and,
If cashed out within 5 years, one quarter of interest is forfeited.
Look at the Treasury I-series website.
It is possible that the next I bond cycle beginning 1 November may have a higher rate.
Keep in mind that is possible that interest rates on other government and corporate bonds and even CDs could exceed 9.62% within the next few years. Right now I am leery of investing in any T-securities with maturities over six months. And right, now you can buy them at a little over 4% yield. I well remember what happened in the 1980s.
They mist be held for at least one year, and,
If cashed out within 5 years, one quarter of interest is forfeited.
Look at the Treasury I-series website.
It is possible that the next I bond cycle beginning 1 November may have a higher rate.
Keep in mind that is possible that interest rates on other government and corporate bonds and even CDs could exceed 9.62% within the next few years. Right now I am leery of investing in any T-securities with maturities over six months. And right, now you can buy them at a little over 4% yield. I well remember what happened in the 1980s.
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tominboise
Member
By one quarter of interest, I presume you mean 3 months of interest, not 1/4 of the 5 year period.
Alpo
Member
Those I-bonds are confusing.
I have some I bought back in 03. I just went and looked them up. The current interest rate on them is 10.77%.
Now WHY would bonds I bought 19 years ago be making 10.77, while bonds I buy this morning would only pay 9.62? I realize that the interest rate on these things changes, but it just seems like an I-bond should pay the same amount, whether I bought it 29 years ago or yesterday.
I have some I bought back in 03. I just went and looked them up. The current interest rate on them is 10.77%.
Now WHY would bonds I bought 19 years ago be making 10.77, while bonds I buy this morning would only pay 9.62? I realize that the interest rate on these things changes, but it just seems like an I-bond should pay the same amount, whether I bought it 29 years ago or yesterday.
THE PILGRIM
Member
If you have money looking for a home,
Not happy with Most Bond Interest,
Stocks tanking, just looked at mine, Down Today.
Just get online to the kind of confusing Treasury Direct site and open an account.
They'll take the $10,000 directly from your Bank (Credit Union).
Not happy with Most Bond Interest,
Stocks tanking, just looked at mine, Down Today.
Just get online to the kind of confusing Treasury Direct site and open an account.
They'll take the $10,000 directly from your Bank (Credit Union).
OP
CAJUNLAWYER
Member
treasurydirect.com is the web site.
In financial matters what works for one may not work for another-everyone's situation is different.
In financial matters what works for one may not work for another-everyone's situation is different.
As in all investing, make sure you know what you're doing. Don't just be seduced by an attractive number.
Kaaskop49
Shield #5103
Kaaskop49
Shield #5103
Hey Caj, can you loan me 10k? 
THE PILGRIM
Member
Right now, with Inflation running at 10+%, your money is losing massive buying power.
So most anything you do feels like bailing the Titanic with a coffee cup.
My strategy is to offset the Inflation as much as I can it Safely do.
Like, lately the Bonds I like are the US Gov AGENCY BONDS.
FHA, FANNIEMAE, Fed HOME LOAN BANKS, ETC.
I buy mostly short term and buy Individual Bonds!
It's not a good time to buy Bond Funds!
So most anything you do feels like bailing the Titanic with a coffee cup.
My strategy is to offset the Inflation as much as I can it Safely do.
Like, lately the Bonds I like are the US Gov AGENCY BONDS.
FHA, FANNIEMAE, Fed HOME LOAN BANKS, ETC.
I buy mostly short term and buy Individual Bonds!
It's not a good time to buy Bond Funds!
Besides the 10K for each individual SS number, it you have a trust with the SS numbers included, you can get another 10K in I-bonds. Right now they are a great deal. And yes, he meant 3 months interest.
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I recall back in Peanut Carter's presidency, CDs hit 18+%. Couldn't convince my father to invest 
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OP
CAJUNLAWYER
Member
That's kinda what I am hoping for-get a big spike in interest-load up and wait for the collapse.I recall back in Peanut Carter's presidency, CDs hit 18+%. Couldn't convince my father to invest
Countrycuz
Member
I recall back in Peanut Carter's presidency, CDs hit 18+%. Couldn't convince my father to invest
So far I haven't noticed CD interest rates going up much . I've been waiting.
Invested $20K ($10K for each for my wife and I) at 9.62% back in August so I am maxed out for 2022. I will be investing another $20K in January. If as you say there are other secure investments that exceed 9.62 % by a significant amount in six month to a year I will take the three months interest hit and move funds.
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For awhile I was loaning money direct to the Fed through short term notes. Higher interest rate than the banks and could pull out much sooner. Then interest dropped to virtually nothing. After the Fed went to digital only transactions I have no interest in doing business with them again. A piece of paper might not be worth much, but it eliminates the "Data, what data?" response to where your money is.
I have some I bonds. Be aware that the interest adjusts every 6 months. It could go up or down. In the near term it will be going up, but it could go down in the future. If you decide to invest in them keep a close watch on the current rate to see when to get out.
DWalt
Member
Right now is not an opportune time to invest in any long maturity debt obligations. Or even preferred stocks. Maybe later, after interest rates show indications of peaking. I wish I knew when that will be.
slickracer
Member
The only downside is the horrid Treasury Direct website, it's literally like stepping back to the year 2000.
wnwitzell
Member
Setting up the account is a real test. At least for this computer challenged old geezer….
tominboise
Member
The rate will readjust on November 1, and is supposed to go down to 6.4% for the next 6 months. It could be higher if they add a fixed component to it, but that is unlikely. Still beats 6 month CD rates by quite a bit.
THE PILGRIM
Member
Yes the Treasury Site is a little squirrelly.
But it's worth it if you want to get a high Interest Rate for a few years.
But it's worth it if you want to get a high Interest Rate for a few years.
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I just buy treasuries through my broker. Of course I can't get savings bonds through them. For me it's not worth the hassle. But they make sense for a lot of people.
I have no problem buying treasuries as long as you can hold them to maturity. You may not make as much as you could have but you won't lose principal. "Bond ladders" are making a comeback. Buy 6 month, 12 month, 18 month, and 24 month maturities and when each matures, buy a 24 month. You'll average up your interest rate as you work through it. Or go every three months. Your call.
Or use CD's. The brokered CD's my broker has are competitive with treasuries. Right now they are at 4.5% and treasuries are mostly a tad lower though I didn't look at new issues.
I stay away from bond funds for the most part. With a bond held to maturity you won't lose principal. Not so with bond funds. Since they trade, they take losses.
I have no problem buying treasuries as long as you can hold them to maturity. You may not make as much as you could have but you won't lose principal. "Bond ladders" are making a comeback. Buy 6 month, 12 month, 18 month, and 24 month maturities and when each matures, buy a 24 month. You'll average up your interest rate as you work through it. Or go every three months. Your call.
Or use CD's. The brokered CD's my broker has are competitive with treasuries. Right now they are at 4.5% and treasuries are mostly a tad lower though I didn't look at new issues.
I stay away from bond funds for the most part. With a bond held to maturity you won't lose principal. Not so with bond funds. Since they trade, they take losses.
DWalt
Member
I remember that back in the early 1980s you could buy brokered CDs paying over 15%. That wasn't as good as it sounds, as it was a period of rampant inflation and prices were going crazy. My fear is that we could well be returning to that time. Remember for fixed income debt instruments, their price moves inversely to the market interest rate. Long maturities can kill you in this environment.
wnwitzell
Member
My current ibonds are accruing 12% interest. 2002 issue date for paper bonds. I should have bought more. Oh well….
5spotter
Member
I've noticed a difference between CD rates quoted by a brokerage vs rates I see advertised from a quick search.
I have access to 12 month CD's now paying 4.1%. Nothing to write home about yet but it beats letting cash languish where it's losing 8% yearly.
Rates are inching up- rewarding good savers for the first time in about 15 years. I'm hesitant about a commitment longer than 3 or 6 months because rates could be higher soon.
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DWalt
Member
For debt instruments available for purchase and sale on the secondary market, it is important to make a "yield to maturity" determination. That means including the gain or loss on your initial purchase cost due to interest rate changes during the holding period. That is because a fixed interest instrument may sell at a price either greater than or below its value if held to maturity due to prevailing interest rates. I won't get into details, but if you are interested in long-term maturity corporate or government bonds investments, it is something that can't be ignored. The longer the maturity, the more important it becomes.
Regarding CD rates, at present the best one-year bank CDs are yielding only about 4%. To me, that doesn't seem particularly attractive. I would rather go into 6 month T-notes which are paying a little more and have a shorter maturity. I feel that in six months, T-bill rates will be substantially higher and you can get into those then.
Regarding CD rates, at present the best one-year bank CDs are yielding only about 4%. To me, that doesn't seem particularly attractive. I would rather go into 6 month T-notes which are paying a little more and have a shorter maturity. I feel that in six months, T-bill rates will be substantially higher and you can get into those then.
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LoboGunLeather
US Veteran
Go to treasurydirect.gov, I-bond purchases are electronic and only direct to the public (no brokers or banks). Open an account on treasurydirect, link to a bank account, enter your "buy" order, funds will be transferred from your linked account (usually next day).
Current rate is 9.62% on bonds purchased by October 28, 2022 and will be locked in for first 6 months. Purchases after October 28 will be at the new inflation-adjusted rate (currently estimated at 6.47 to 6.48%).
For those wishing to purchase additional treasury bonds over the $10K annual limit (per individual) you may want to look at 2-year Treasury Bonds, currently at fixed rate of 4.507%.
The government website is full of information and FAQs.
LoboGunLeather
US Veteran
I-bond rates include two factors, a fixed interest rate and the inflation-adjustment computed semi-annually based on the CPI-U. The fixed rate is now 0% (since about 2020), but has fluctuated since I-bonds were first announced in 1998, usually in the 1.5% to 3% range. The fixed rate is determined by the date of bond purchase and cannot go down during the life of the bond, but can be adjusted upward by the feds.
Around 2020 inflation was so low that there was little need to offer a fixed rate; everyone was looking for anything that would beat the rates on bank CDs and money market accounts.
Is that like saying the stripper really does not like me and just wants my dollar bills? I am so confused...
