I bonds are incredibly low risk because they are backed by the full faith and credit of the United States government. The United States has never defaulted on paying back its debtors who hold savings bonds. The only risk of receiving your principal back is for the United States government to fail pay its debts. Savings bonds are the safest investments that you can find.
I Bonds Benefit From High Rates of Inflation
You may hate paying more money at the gas pump and more money for groceries but there is an upside to that. While inflation may mean paying more for goods and services; inflation also means higher wages and higher interest rates on I Bonds.
I bonds are savings bonds that earn interest based on a fixed rate and the inflation rate.
Now is the time to buy savings bonds.
I Bonds Are Paying High Interest Rate
I bonds are currently paying 7,12% in interest for the next six months. The interest rate reset in the beginning of November and will pay investors this rate through April. Inflation is likely to stay high for the next year so the bonds are a good investment for the next 12 months.
I Bonds Have Low Minimum Purchase Amounts
You don’t need thousands of dollars to buy I bonds. I bonds can be purchased with as little as $25. You can buy an I bond for just $25. You can buy as many as you want up to a maximum of $10,000 per year.
I Bonds Can Be Purchased Online
You no longer have to go to bank of financial institution to purchase a savings bonds. You can buy I Bonds right from the comfort of your own home on the US Government’s website at treasurydirect.gov
I Bonds Can Be Held For A Long Duration
I bonds earn interest for a 30 year time period unless you cash them in. You can sell in an I Bond anytime after holding them for 12 months.
I Bonds Are Tax Free
I Bonds are free from and state and local income tax free. The only taxes that you pay on I Bonds are at the federal level when you redeem the bonds.