If you’re looking for an investment with a high interest rate, inflation protection and the safety of government backing, then Series I bonds could be an attractive addition to your portfolio. The Treasury Department announced that I bonds will now pay 6.89% for a full six months on any bonds issued between Nov. 1, 2022 and April 30, 2023.
The interest rate on these bonds increases as inflation rises, ensuring that your payout keeps pace with rising prices and that you don’t lose purchasing power over time. Of course, if inflation falls, then so does the rate on these bonds. In contrast to the Series I bonds, the current interest rate on Series EE bonds is a modest 2.1%.
This inflation protection on I bonds has caused a stir among savers in the last year, as it rocketed to the highest level in some 40 years. That level of inflation pushed the rate on I bonds to 9.62% for bonds issued between May and October 2022. The new lower rate reflects a decline in inflation, though inflation remains well above the Federal Reserve’s target. Savers have been scrambling for any way to protect their money from the ravages of rising prices.
