I Bond.

what are the pros and cons of purchasing I Bonds?

Pro-pretty high interest rate right now and for the foreseeable future. New rate will be announced in November. Currently paying 9.62%. Easy to buy from Treasury Direct.

Con-only $10k can be invested per calendar year, per person, but there are gifting allowances. You pay a 3 month penalty if you sell it before 5 years, so you need to keep it at least 15 months to really get a nice benefit from them.

I'm sure others will chime in...

Here’s some information regarding I bonds:

Should you buy an ibond?

The 9.62% interest rate certainly looks appealing but there is a little more to ibonds that you should consider before purchasing.

* The rate is for only six months. Granted, inflation will still be high in six months so chances are you'll receive another high interest rate for the following six months.

* The interest rate has two components to it. A variable rate and a fixed rate. The variable rate is linked to inflation and measured by the CPI-U (Consumer Price Index for Urban Consumers) which is why the ibond is paying 9.62%. The fixed rate is determined by the Treasury and it's currently at 0%. So as inflation comes down, so will the variable rate portion of your ibond every six months.

*Liquidity. You can't sell your ibond for the first year. If you sell it in the first five years, you'll lose 3 months of interest.

* This isn't a product that you'd want to put your emergency funds in due to the inability to get to your money within one year. I'd suggest it would fall into your five-year fixed income bucket.

To learn more you can go to Treasury Direct https://www.treasurydirect.gov/indiv...terms.htm#infl

The only con is having to use that 1990's style Treasury Direct site. I think they may have upgraded it the other day so maybe it is better now.