So, you saw that juicy 9% rate in 2022, took the plunge on TreasuryDirect.gov and got an I Bond. Nice! Welcome to the party. But as you probably have already seen, rates have dropped substantially since then. What does this mean for your bonds, and should you cash out to find greener places to park your money? What's the optimal time to sell?
Disclaimer: it's no secret that the crew here at YourTreasuryDirect loves I Bonds, and that we think they are a great asset to hold for the long term. However, many of you have asked what factors to consider when selling, so we put together a guide to help folks find the right answer for their financial journey. Every situation is unique, and (taps sign) this is not financial advice.
Below are 8 key factors to think about when considering an I Bond sale, plus one simple rule of thumb.
Be sure to check out the custom calculators designed to help with the math for your specific bond.
Grab a cup of coffee, and let's dive in.
|Fixed Rate for Your Bond bought in Feb 2020
|Average Fixed Rate over the last 5 Years
|Average Fixed Rate over the last 10 Years
|Average Fixed Rate All Time
"How much can I cash at one time? Any amount of $25 or more to the penny. If you cash only part of what a bond is worth, you must leave at least $25 in your account. If you cash only part of what a bond is worth, you get the interest only on the part you cash."Why this preoccupation with $25? Under the hood, the Tresury appears to basically treat any size of I Bond as a collection of $25 bonds. Buying $100 I Bond? That's really more like 4 X $25 bonds. This is usually abstracted away and doesn't matter, but does effects things like interest rounding.