Does anyone mess with these?
Only $10k allowed per year
https://www.treasurydirect.gov/indiv/research/indepth/ibonds/res_ibonds.htm
so a fixed rate that is essentially 0 and a variable rate that goes with inflation. how is this any different from tips? anyways, what i know is us govt bonds are garbage. id rather have cash for liquidity and take the inflation hit w/o any interest.
If I understand correctly, these I-bonds seem to be puttable at 100% of principal (regardless of where interest rates are) after 1 year. Seems like a reasonable vehicle to park cash beyond immediate liquidity needs (<1 yr) and get a rate better than a savings account?
Here are some additional details:
- current yield: 3.54%
- Annual max - $10k
- State and local tax-free
- federal taxes are deferred until the bond is sold
- must be held at least one year
- if redeemed before 5 years, lose 3 months of interest