November 6, 2018

I-bond rate increases to 2.83%


The current interest rate on I-bonds: 2.83% for bonds issued November 2018-April 2019.

https://www.treasurydirect.gov/indiv/products/prod_ibonds_glance.htm
This is an increase from 2.52% for the previous 6 months. 
Learn about I-Bonds: 
Rates & Terms

  • I bonds have an annual interest rate derived from a fixed rate and a semiannual inflation rate.
  • Interest, if any, is added to the bond monthly and is paid when you cash the bond.
  • I bonds are sold at face value; i.e., you pay $50 for a $50 bond.


Redemption Information

  • Minimum term of ownership: 1 year
  • Interest-earning period: 30 years
  • Early redemption penalties:
    • Before 5 years, forfeit interest from the previous 3 months
    • After 5 years, no penalty


Tax Considerations

  • Savings bonds are exempt from taxation by any State or political subdivision of a State, except for estate or inheritance taxes.
  • Interest earnings are subject to Federal income tax.
  • Interest earnings may be excluded from Federal income tax when used to finance education (see education tax exclusions).

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