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Why Aren't I-Bonds Getting More Attention?
05-13-2022, 04:39 PM
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#1
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Confused about dryer sheets
Join Date: May 2022
Location: Portland
Posts: 1
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Why Aren't I-Bonds Getting More Attention?
With today's inflation rates, they seem like a great option for medium-term investing, as a hedge against inflation. Yet it seems like they're not getting much attention.
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05-13-2022, 04:44 PM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2016
Location: Colorado
Posts: 8,971
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I see them brought up everywhere.
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05-13-2022, 05:28 PM
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#3
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2016
Posts: 8,968
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You can only buy 10 grand a year, so yeah, get as much as you can -
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05-13-2022, 05:55 PM
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#4
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Thinks s/he gets paid by the post
Join Date: Jan 2019
Location: Sunny California
Posts: 2,567
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Many smart people on here have been buying I-bonds since last November and some have used the legal ways to buy more than 10K using the gift box, trusts etc.
https://www.early-retirement.org/for...ad-113668.html
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05-13-2022, 06:05 PM
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#5
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2011
Location: West of the Mississippi
Posts: 17,134
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They have been discussed on this site for at least 5 months.
__________________
Comparison is the thief of joy
The worst decisions are usually made in times of anger and impatience.
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05-13-2022, 06:42 PM
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#6
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 36,204
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But, while my experience with it has been ok, Treasury Direct is a real PITA and if you have something that you have to call them on you can be on hold for hours.
I helped my aunt and uncle set up their accounts and didn't know that Navy Federal, where they have their savings account, doesn't play well with Treasury Direct, so their first purchase was rejected. The stupid thing is while you can set up a bank account online when you set up an account, you can't later add a bank account online, you have to do it via a paper form that requires Medallion signature... stupid.
I'm very surprised that my 89-yo aunt has persevered on all this and didn't just give up... I think that I would have.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
Retired Jan 2012 at age 56
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05-13-2022, 07:43 PM
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#7
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Oct 2017
Location: Chapel Hill, NC
Posts: 5,290
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My mother has some paper I bonds and has had difficulty cashing them at her bank. It seems a lot of trouble to go to when you can only invest $10,000 per year.
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05-13-2022, 07:58 PM
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#8
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2013
Location: Limerick
Posts: 5,633
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Quote:
Originally Posted by harllee;
My mother has some paper I bonds and has had difficulty cashing them at her bank. It seems a lot of trouble to go to when you can only invest $10,000 per year.
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It’s not that difficult to send them in to convert them to electronic iBonds. I did it a few years ago. The instructions are on the TD website.
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05-13-2022, 08:00 PM
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#9
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2013
Location: Limerick
Posts: 5,633
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Quote:
Originally Posted by pb4uski
But, while my experience with it has been ok, Treasury Direct is a real PITA and if you have something that you have to call them on you can be on hold for hours.
I helped my aunt and uncle set up their accounts and didn't know that Navy Federal, where they have their savings account, doesn't play well with Treasury Direct, so their first purchase was rejected. The stupid thing is while you can set up a bank account online when you set up an account, you can't later add a bank account online, you have to do it via a paper form that requires Medallion signature... stupid.
I'm very surprised that my 89-yo aunt has persevered on all this and didn't just give up... I think that I would have.
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Navy Federal requires any external electronic transfers to take place from their checking account. I know it’s inconvenient, but it’s stated in their instructions.
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05-13-2022, 08:10 PM
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#10
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2011
Location: West of the Mississippi
Posts: 17,134
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Quote:
Originally Posted by harllee
My mother has some paper I bonds and has had difficulty cashing them at her bank. It seems a lot of trouble to go to when you can only invest $10,000 per year.
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Heck, I stop to pick up a dime I see on the ground. A few hours to earn an extra $2000 via my 2021 and 2022 Ibond purchases is a pretty good hourly wage.
__________________
Comparison is the thief of joy
The worst decisions are usually made in times of anger and impatience.
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05-13-2022, 08:10 PM
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#11
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2011
Location: West of the Mississippi
Posts: 17,134
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Quote:
Originally Posted by pb4uski
I'm very surprised that my 89-yo aunt has persevered on all this and didn't just give up... I think that I would have.
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I think she is to be admired. At 89 she seems pretty sharp to me.
__________________
Comparison is the thief of joy
The worst decisions are usually made in times of anger and impatience.
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05-15-2022, 05:36 AM
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#12
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Recycles dryer sheets
Join Date: Jun 2011
Posts: 297
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Because I Bond limit is only 10K/yr so there is nothing much to talk about. It's not really an investment. Having said that... every investor is surely buying it... I did
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05-15-2022, 06:01 AM
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#13
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2013
Location: Limerick
Posts: 5,633
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They add up over time. Together we have about $130k in iBonds. Some go back to the year 2000 and are paying very nice interest rates.
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05-15-2022, 06:16 AM
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#14
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Oct 2017
Location: Chapel Hill, NC
Posts: 5,290
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Do many of the iBond owners here have the older paper ones? My 90 year old mother has a bunch of paper iBonds and EE bonds that she periodically cashes in for living expenses. Until this year her bank Wells Fargo would cash them for her but they will no longer cash them. I know she can mail them in to get them cashed but I have read that it takes months to get your money. For those of you who have paper bonds and want to cash them in how are you doing so?
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05-15-2022, 07:19 AM
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#15
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2003
Location: Florida's First Coast
Posts: 7,654
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Honestly, too much effort for a minimal investment of $10 or $20k a year with ~$2k return does not make a dent or make it worth the effort. If it were $100 or $500k then I would do it.
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"Never Argue With a Fool, Onlookers May Not Be Able To Tell the Difference." - Mark Twain
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05-15-2022, 08:20 AM
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#16
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Administrator
Join Date: Apr 2006
Posts: 22,923
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Quote:
Originally Posted by ShokWaveRider
Honestly, too much effort for a minimal investment of $10 or $20k a year with ~$2k return does not make a dent or make it worth the effort. If it were $100 or $500k then I would do it.
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The young wife and I bought $100k of I-bonds over 5 months starting in December 2021. In total, I doubt it took more than 30 minutes of my time, and the majority of that was setting up the account the first time. The cash was otherwise idle, earning 0.01% in my checking account. I think it was worth the effort to earn $8541 over one year.
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Living an analog life in the Digital Age.
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05-15-2022, 08:22 AM
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#17
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2003
Location: Florida's First Coast
Posts: 7,654
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Quote:
Originally Posted by Gumby
The young wife and I bought $100k of I-bonds over 5 months starting in December 2021. In total, I doubt it took more than 30 minutes of my time, and the majority of that was setting up the account the first time. The cash was otherwise idle, earning 0.01% in my checking account. I think it was worth the effort to earn $8541 over one year.
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How if there is a 10k per year per person limit? Not a lot of point in stating this without sharing how?
__________________
"Never Argue With a Fool, Onlookers May Not Be Able To Tell the Difference." - Mark Twain
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05-15-2022, 08:35 AM
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#18
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Administrator
Join Date: Apr 2006
Posts: 22,923
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Quote:
Originally Posted by ShokWaveRider
How if there is a 10k per year per person limit? Not a lot of point in stating this without mentioning how?
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The strategy was discussed at length in the other, very long I-Bond thread here https://www.early-retirement.org/for...ad-113668.html
But I'll recap:
In Dec 2021, the young wife and I each purchased $10k for our own account.
In Jan 2022, we each purchased $10k for our own account
In Feb 2022, we each purchased $10k as a gift for each other, to be delivered on 1/1/23.
In Mar 2022, we each purchased another $10k gift to be delivered on 1/1/24
In Apr 2022, we each purchased yet another $10k gift to be delivered on 1/1/25.
So a total of $100k for the two of us. For the first six months, each of those bonds will earn at a rate of 7.12%, for the next six months at a rate of 9.62%, for an annual return of 8.54% the first year. Yes, one must consider the 3 month early redemption penalty and the annual limits that cause the last of the gifts to be tied up until 1/1/25, but all-in-all, it is a very substantial return for minimal effort.
__________________
Living an analog life in the Digital Age.
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05-15-2022, 08:43 AM
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#19
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Sep 2012
Location: Seattle
Posts: 5,991
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The more I think about it, the more the gift thing actually makes financial sense. Yes, the money is locked up, but it is earning 9.62%.
Is it better to have money locked up earning 9.62% or money available that is earning 1.2%?
I just wish I could purchase ibonds in IRA or 401k...
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05-15-2022, 08:44 AM
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#20
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2003
Location: Florida's First Coast
Posts: 7,654
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Thanks, it is still not really for us. I guess it would be different if it made a big difference to our Quality of life. Not knocking the strategy or others who care to do it. We would rather ladder $1m in MYGAs and CDs when rates hit my threshold. and just forget about it for 5 to 10 years. Again, this is just our opinion, and is great while the inflation rate of return stays high.
The above looks like a great deal for those who wish to do it.
Thanks for the recap.
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"Never Argue With a Fool, Onlookers May Not Be Able To Tell the Difference." - Mark Twain
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