The I Bond Thread

[Exit 2024]

When I look at that chart, I note that the May 1 adjustment immediately following a fourth quarter with 3 months of negative CPI change is almost always substantially less than the preceding November 1 change.

Not sure that I understand the above, but table organized as line=year, so May 1 on line for 2023 uses last 3 months from the line above (2022) and first 3 months on the same line (2023).
If you you look at 2 instances where May 1 adjustment was negative - you can see that last 3 months from previous year was greatly exceeding current (2023 last 3 months) of -0.34% and were hard to offset. I still predict positive inflation rate for May 1 adjustment as -0.34% very close to long term average for those 3 months. I guess we will see ....

 

[Gumby]

After further consideration while showering (when I do some of my best thinking) I would clarify to say that while we possibly could avoid a zero variable rate in May, it will almost certainly be substantially less than the 3.94% of this past November.

 

[audreyh1]

TIPSwatch almost always has something about IBonds after each CPI Release.
https://tipswatch.com/2024/01/11/de...-an-upside-surprise-annual-rate-rises-to-3-4/

Personally I don’t pay much attention to the 6 months inflation rate changes. I focus on the fixed rate.

I’ve already cleaned out all the lowest fixed rate IBonds.

 

[Jerry1]

Redeemed all my I-Bonds today. They were bought in April and November 2022. Don’t see me using Treasury Direct again. Not bad but a little too cumbersome when I can buy similar instruments with a few clicks in my Fidelity account. All in all, made good money for a short time. I’m okay with that.

 

[pb4uski]

+1. That is the path that I am on. Will be done on Jan 1, 2025!

Made good money too.

 

[Fermion]

Redeemed all my I-Bonds today. They were bought in April and November 2022. Don’t see me using Treasury Direct again. Not bad but a little too cumbersome when I can buy similar instruments with a few clicks in my Fidelity account. All in all, made good money for a short time. I’m okay with that.

I'll never use treasury direct again either. It just isn't worth it for the hassle.

 

[Gumby]

Knock wood, but I've never experienced a problem with Treasury Direct. Their website is less intuitive than some, but I have been able to buy, register, gift, redeem, and check the value of I bonds easily and quickly. I'm not sure what else I would need them to do for me.

 

[finnski1]

Knock wood, but I've never experienced a problem with Treasury Direct. Their website is less intuitive than some, but I have been able to buy, register, gift, redeem, and check the value of I bonds easily and quickly. I'm not sure what else I would need them to do for me.

I haven't had a single issue either. I have one $10k I bond left and will probably sell any day now. I would have no problem going back in again at a later date if conditions warrant.

 

[Eucerin]

I would sell mine, but I don't want to generate any interest income so that I can keep my MAGI down for ACA.

For the same reason

 

[Eucerin]

We have last gift is sitting in the gift box to be pushed, we are going to wait until March to push it

 

[audreyh1]

Knock wood, but I've never experienced a problem with Treasury Direct. Their website is less intuitive than some, but I have been able to buy, register, gift, redeem, and check the value of I bonds easily and quickly. I'm not sure what else I would need them to do for me.

I find Treasury Direct straightforward. I only use it for buying and redeeming IBonds. I appreciate the stark simplicity.

 

[RunningBum]

I won't do the tax refund purchase method again. Dealing with all of those small denomination bonds (didn't they come in individual mail envelopes?), mailing them in, waiting to see if they showed up in my account, and they redeeming them one at a time was more work than it was worth. Though the TD site was lighting quick for redemption for me.

If another opportunity like we just had for purchasing comes again, I'll consider $10K purchases.

 

[jollystomper]

I almost "flipped" I Bonds this month redeeming some bonds were more than 3 months into the 3.38% rate, and using the monies to purchase gifts for 2025 delivery. But with the discussion of potential negative rates in the next 6 month cycle, I am going to hold off until we see what the next variable rate turns out to be, as I can still get the current rate for purchases at that time. I will just park the I Bond money redeemed this month into short term T Bills or Vanguard MMs until then.

 

[audreyh1]

The only thing is I doubt we see the 1.3% fixed rate again for a long time.

The last time the fixed rate was 1% or higher was early 2008.

I’m buying our annual allotment later this month.

 

[wmc1000]

I waited almost three hours to get a human being who could unlock my account.

Just as an FYI, customer service is much better now that rates are lower than a couple of years ago. I had tried to login to my wife's account to check balances arounf the first of the year and mistyped the password a couple of times, (fat fingers!), and when I couldn't remember all 3 security question answers correctly the account was locked. Yesterday, I called in while my wife was nearby!, and the call was answered in a couple of minutes. They asked to speak with my wife and after she answered the security questions correctly the customer service person unlocked the account.

PS: I wrote down the security question answers in case I screw up the password again!

I transferred the last $10K that was in the gift boxes and will probably redeem them and our other IBonds next month.

 

[BlueberryPie]

IBonds are a safety game, not really an investment or even saving vehicle. Yes we were able to use them for high yield for the past two years, but it's not really what they're designed for. They're mostly designed to keep some amount of cash inflation -protected. Hence great for a large sum of money you don't know when you'll use. Great for an emergency fund (past the 1st year).
Wishing for higher Ibond rates is wishing for inflation. I'll take low iBond rates thank you. Yeah my IBonds won't grow much, but that's not their job, my portfolio has that job, and that job is a lot easier when inflation doesn't take out some of the gains.

Fixed rates are the icing on the cake, or help with the tax bill when you redeem as I see it.

 

[Dash man]

I redeemed all of my post 2008 iBonds this past week. Putting them into either CDs or treasuries next week, except for keeping some for current expenses.

 

[Chuckanut]

I got rid of my 0% fixed rate Ibonds. I am keeping my 0.4% and 0.9% bonds since they give me a better chance of keeping even with inflation after taxes. And I will buy my full allotment of 1.3% bonds, again because it offers a good chance I can beat inflation in real terms.

My #1 inflation hedge is common stocks, but as we all know that is a long term investment. Ibonds along with a few TIPS help me cover all my bases.

 

[Sunset]

Just as an FYI, customer service is much better now that rates are lower than a couple of years ago. I had tried to login to my wife's account to check balances arounf the first of the year and mistyped the password a couple of times, (fat fingers!), and when I couldn't remember all 3 security question answers correctly the account was locked. Yesterday, I called in while my wife was nearby!, and the call was answered in a couple of minutes. They asked to speak with my wife and after she answered the security questions correctly the customer service person unlocked the account.

PS: I wrote down the security question answers in case I screw up the password again!

I transferred the last $10K that was in the gift boxes and will probably redeem them and our other IBonds next month.

This is why I like a password manager like KeePassXC (free) as it has room to write the questions and answers for all the sites I use.
Before that I used a spreadsheet which worked.

Either way is great because True answers can be looked up/found by hackers.
By writing them down I make up fake answers, and different answers for same question on different sites.
Example: elementary school you attended: TheGreatEducation2FarFromMommy

My elementary school could be looked up easily.
Nobody can ever guess my answers
I back up my answers of course.

 

[sengsational]

Redeemed all my I-Bonds today. They were bought in April and November 2022. Don’t see me using Treasury Direct again. Not bad but a little too cumbersome when I can buy similar instruments with a few clicks in my Fidelity account. All in all, made good money for a short time. I’m okay with that.

I redeemed my mom's one I-Bonds yesterday. I jumped on with the 9% hype here, and I think she ended up with 6% IRR, which ain't bad, but not worth the trouble for $10K at a time.

 

[Happyras]

I sold the last one yesterday as well. Definitely not worth the hassle for 10K a pop. We gifted to each grand kid, and now we have opened UGTMA accounts at Fido for each, where we can buy secondary treasuries and invest more broadly as the tides turn.

 

[Gumby]

I redeemed my mom's one I-Bonds yesterday. I jumped on with the 9% hype here, and I think she ended up with 6% IRR, which ain't bad, but not worth the trouble for $10K at a time.

The young wife and I bought five $20k tranches of I bonds, one per month, between December 2021 and April 2022. using the gift box strategy. I redeemed the first four on 9/1/23, 10/1/23, 11/1/23 and 1/1/24. Even accounting for the forfeited interest, the annualized rate of return for the first three tranches was 6.72%. The fourth was 6.57%. The fifth must remain in the gift box until 1/1/25 and will be lower. Much better returns are available now, but in early 2022 I-Bonds were the best deal by far and it didn't seem like that much effort to me.

 

[Jerry1]

The young wife and I bought five $20k tranches of I bonds, one per month, between December 2021 and April 2022. using the gift box strategy. I redeemed the first four on 9/1/23, 10/1/23, 11/1/23 and 1/1/24. Even accounting for the forfeited interest, the annualized rate of return for the first three tranches was 6.72%. The fourth was 6.57%. The fifth must remain in the gift box until 1/1/25 and will be lower. Much better returns are available now, but in early 2022 I-Bonds were the best deal by far and it didn't seem like that much effort to me.

Yes. I’m very happy with the return considering what else was available at the time. Also, “not worth the trouble” doesn’t apply to me. TD wasn’t the most up to date site, but it worked and I made great interest on $40K (two tranches for me and DW) for just a couple clicks and some data entry from my comfortable office chair. I’m good with that.

 

[FindingForward]

For those of you who are getting rid of all your ibonds - are you still keeping the TD account itself open? Or closing out the account as well?

 

[BlueberryPie]

what are you guys selling your 0%-fixed iBonds putting the money in instead?