The I Bond Thread

[homestead]

Figured it out. Since mine were converted paper bonds I had to link to converted bonds account first then I was able to see 2024 1099's.

 

[audreyh1]

I got an email from TD.

Yes, things have changed, yay!

 

[pb4uski]

Figured it out. Since mine were converted paper bonds I had to link to converted bonds account first then I was able to see 2024 1099's.

Another reason that I will not miss Treasury Direct

 

[Chuckanut]

Note: This is copied from an old now closed thread to this more active thread.

Personally, I was a bit surprised that the fixed Ibond rate went down to 1.2% from 1.3%. I thought given inflation in the 2.5 to 3 percent range, it should have gone up to at least 1.5%. Compared to the 30 year TIPS at 2.4%, the new Ibonds reduce the real return by 1/2. Not so good.

 

[BlueberryPie]

remember there is no interest risk in iBonds, you can cash it any time after a year (with a small penalty for the first 3 years), so comparing it to a 30 year bond (where the only guarantee is that it will pay in 30 years) is not a fair comparison. IF you know you're not cashing it for another 30 years, then by all mean you should go with the TIPS.

 

[jim584672]

remember there is no interest risk in iBonds, you can cash it any time after a year (with a small penalty for the first 3 years), so comparing it to a 30 year bond (where the only guarantee is that it will pay in 30 years) is not a fair comparison. IF you know you're not cashing it for another 30 years, then by all mean you should go with the TIPS.

A small correction, the penalty for early withdrawal of an I Bond is losing the last three months of interest earned if you cash it in within five years. There is no penalty if you hold the bond for at least five years.

 

[BlueberryPie]

yes typo, meant to say 5 years

 

[Koolau]

I may have asked this before. Is there a way to cash in paper I-bonds without going through TD? The web site seems daunting to me.

 

[audreyh1]

I may have asked this before. Is there a way to cash in paper I-bonds without going through TD? The web site seems daunting to me.

You used to be able to do it at your bank. I don’t know if that’s still true.

 

[Gumby]

I may have asked this before. Is there a way to cash in paper I-bonds without going through TD? The web site seems daunting to me.

These Youtube videos will help you convert your paper bonds to electronic form and then redeem them.

 

[nwsteve]

You used to be able to do it at your bank. I don’t know if that’s still true.

We did it six months ago at our commercial bank--no biggie

 

[Koolau]

These Youtube videos will help you convert your paper bonds to electronic form and then redeem them.

Thanks. I appreciate that. I need to start titrating my I-bond redemptions before they too become a tax bomb.

 

[Chuckanut]

Tipswatch has opined that Ibonds at 1.2% or even 1.1% may be a better deal than a 5 year TIPS when the Ibond advantages are taken into account.

Maybe you haven’t noticed, but I Bonds are getting more and more attractive as the 5-year TIPS yield declines. An I Bond can be redeemed after 5 years with no penalty, so it is directly comparable to a 5-year TIPS, but has advantages of tax deferral, better deflation protection and no market fluctuations.

An I Bond with a fixed rate of 1.20% is more attractive than a TIPS with a real yield of 1.30% or 1.40%, in my opinion. So if TIPS yields continue declining, I Bonds with a fixed rate of 1.20% — or even 1.10% — will remain attractive.

 

[Montecfo]

Currently out of i-bonds but welcome a compelling opportunity to re-enter.

Oh wait.

 

[Koolau]

I'm beginning to think about the tax bomb associated with my I-bonds. I need to begin cashing some in so that they don't all "expire" at once.

 

[steelyman]

I still have 4 I Bonds with 0% fixed rate from 2021 and 2022. While not yet past the 5 year mark, they are candidates for rolling over into new issues and paying tax on the interest.

 

[mrfeh]

I still have 4 I Bonds with 0% fixed rate from 2021 and 2022. While not yet past the 5 year mark, they are candidates for rolling over into new issues and paying tax on the interest.

If you plan on holding them for the long term, I would definitely do that, and before the end of April.

 

[steelyman]

If you plan on holding them for the long term, I would definitely do that, and before the end of April.

Thanks, I was wondering about the timing. I redeemed one in January and bought a new one with the proceeds.

I still can cash in another (from a trust account, separate from individual). I don’t know what to think will happen for the May and November resets.

I find the estimates that have been provided by others in this thread useful.

These are definitely long-term holdings (part of an emergency fund).

 

[mrfeh]

Thanks, I was wondering about the timing. I redeemed one in January and bought a new one with the proceeds.

I still can cash in another (from a trust account, separate from individual). I don’t know what to think will happen for the May and November resets.

I find the estimates that have been provided by others in this thread useful.

These are definitely long-term holdings (part of an emergency fund).

Nobody has a crystal ball, but this guy has done a good job in the past of predicting what the fixed rate will be. As of today, his formulas say it will stay at 1.2%.

I Bond’s fixed rate could fall at May 1 reset. Or not.

5-year real yields are declining. What does it mean for TIPS and I Bonds? Our happy travel group in Torres Del Paine National Park, Chile. View itinerary. By David Enna, Tipswatch.com I’ve ju…

tipswatch.com

 

[target2019]

We dumped one 0% I-bond last year, and one this year. Couldn't fall in love with the TDirect experience.

 

[Gumby]

I redeemed the last of my I-bonds in January, only because I can currently do just as well with regular treasuries, and I enjoy the added flexibility. I never had any problems with using the Treasury Direct site, but even if I did, that would not drive my investment decisions.

 

[Al18]

I cashed in two iBonds for a car down payment.

I like the way TD displays the iBonds value - never shows you the last 3 months interest. So when you cash in the iBond, you get exactly the iBonds displayed value transferred to your bank account in 2 days.

 

[SJhawkins]

I may have asked this before. Is there a way to cash in paper I-bonds without going through TD? The web site seems daunting to me.

I called Wells Fargo about this last week, if you have a account with them you can cash them in, at least that's what they told me on the phone, have yet to try however.

 

[Koolau]

I called Wells Fargo about this last week, if you have a account with them you can cash them in, at least that's what they told me on the phone, have yet to try however.

I might just open an account with any financial institution that would cash some for me. Thanks for the info.