This would probably be a good week to max out your I Bond purchase for the year, if you have not done so.
This would probably be a good week to max out your I Bond purchase for the year, if you have not done so.
Just did that exact thing this afternoon. For anyone that has cash sitting not doing anything for them I would seriously look at this option!!
Don't overlook the "per person" aspect ... his and hers will bring you to $20k/year.
My father in law just emailed me a video about a loop hole Involving gifting of I bonds to a spouse. The premise is that I can buy a gift I bond for my wife. It starts to accrue interest the day I buy it and it is in her name. At a future year when she doesn’t max out her I bond purchases I can then transfer this gift to her and then she can cash it out or hold it.
has anyone heard of this or done it? If legit they would like to do it tomorrow for each other to get another 20,000 in. They have already maxed out their limit for this year. Appreciate any insight you can offer.
here is link.
Just talked with my advisor about I bonds. So electronic you can put in 10k a person. Rate goes into the 9% range beginning May 1.
How do you pay them for these bonds? Also, what do you get to prove what you own? Can they be put into a Family Living Trust?Originally Posted by RyanJ
You go to Treasurydirect.gov and create an account. From there you can transfer the funds from your checking or savings etc into the I Bond. All can be done on your own from the website. I believe my advisor did say they can be put into a trust as well.
As an added note ... it's $10k/person/year PLUS up to $5k/person/year from your tax refund, if applicable.
While most BBC folks don't get a refund (the case with most wealthy folks) it's worth mentioning anyway.
Note - you're committed for one year and you will forgo one quarter of interest in cashed within five years.
There is a way to put them into a trust but I think you may need a separate TIN for the Trust so if you have a revocable trust that uses your social security number it may not allow the purchase if it limits the purchase by tax id numbers so if you already purchased the max under you social it may not work. If you have an irrevocable trust with a different Tax ID number then I believe it can be done. If you go to the Treasury Direct site it does have an option for trusts. I was going to buy some for my kids trust but I started filling the information out and it got to complicated (it asked for some taxpayer filing numbers or something) so I just let it go.
From my original question I’ve done some additional research and the gift option is loophole to get additional dollars bought and interested started earning on them. Not for everyone but for certain people like my in-laws it makes sense to get some additional dollars earning high locked in interest rates.
Has there ever been an I Bond post on the BBC before? If the Lounge posts about I bonds, I'm finding something to short for I bonds
Thanos was the hero
When I met with my finance guy yesterday he brought it up...I said what an I Bond??? Never heard of it before, not once, anywhere, ever..hahaha!!Has there ever been an I Bond post on the BBC before? If the Lounge posts about I bonds, I'm finding something to short for I bonds
I'm not sure but there may be a TIPS ETF that you can buy puts onHas there ever been an I Bond post on the BBC before? If the Lounge posts about I bonds, I'm finding something to short for I bonds
Our Daughter-in-law (who knows very little about finances) send a message this morning, to our family group chat, about I-bonds.
It may be time to short them.
Just did for my wife and I. I wish that they would allow 20-25K instead of only 10K.
Let's see what the next rate is, and I am going back in come January 2023, Lord willing, and cash the prior ones after 15 months.
BTW, if you watch and listen carefully to the video, you will figure out that even though the individual says that you can by more than the allocation of 10K, she puts a big hole in her plan when she states that you cannot give it to them in the yr they have max out a 10K purchase, which bring you right back to the fact that you can only purchase 10K per tax payer's ID.
Last edited by digthemup; 04-28-2022 at 04:31 PM.
but the interest starts accruing the day you buy it so you are getting the benefit of it. So let’s say that the November interest rate drops to 4.5% and next May’s goes to 2. The bond you buy next January is gonna have 6 months at 4.5 and then 6 months at 2 for an average of 3.25. If you bought a gift bond for your wife today you would lock in 6 months of 7.2 and then 6 months of 9.6 so and average of 8.4% for a year and you would be able to get your money back sooner if needed. So a pretty significant difference of return.
The ultra low inflation we have had for so long made I bonds not a good deal but this sudden big rise in inflation suddenly makes them pretty attractive. Might as well take advantage of locking in a good rate!
I understand you point, but I would not invest if I saw that equities were improving and stabilizing. I have my doubts though that inflation is going to reverse as quickly that everyone is hoping. However, I may take advantage of it if May rates do go up to 9%
May rate adjustment is already known. It is 9.6%. That is what makes the timing so unique. GUARANTEED 7.2 for 6 months and then 9.6 for 6 months if you get it bought before May 1. If bought after that you get 6 months of 9.6% and then 6 months of what ever the November adjustment is. Again the known May rate is the unique part of this.
Matt,
That is a good observation about the May rate already known, which as you pointed out is peculiarly unique. It makes me wonder why?? Maybe I am the type of person who is apprehensive about such things, and I get on on edge when that 'WHY' trigger my brain's skill set of training. I have had to deal with some dreadful 'whys' in life.
Just remember these bonds adjust with the rate of inflation. I own some but if we hit a recession and inflation drops to 3 % then that is what it will adjust to. They are great for the here and now but if long bonds go beyond the projected breakeven rate then those may be better options. I'm using them solely for a small portion of cash as a substitute for a savings account.
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