Attractive Features of I Bonds

Here Are Some Of The I Bond’s Attractive Features:

  • I Bonds are based on a straight forward idea. They're sold at face value and grow with inflation protected earnings for up to 30 years.
  • I Bonds are affordable. You can invest as little as $ 50 or as much as $30,000 per year.
  • I bonds are safe. They are U.S. Treasury securities backed by the full faith and credit of the United States Government.
  • I Bonds are Tax advantaged. You can defer Federal taxes on earnings for up to 30 years and they’re exempt from State and Local Income Taxes. The best part is, you don’t need to do anything to get these benefits – They’re built right into I Bonds.
  • I Bonds will usually increase in value every month, and interest is compounded semiannually.
  • I Bonds are liquid and can be turned into cash anytime after six months.

And remember, buying I Bonds goes a long way toward solving the biggest problem that all investors face: finding a way to save that guarantees that inflation won't eat away the value of their savings. For example, if inflation averages only 21/2 percent, in just 10 years it will take $1.28 to equal today's dollar. That means your savings would have to earn 21/2 percent just to stay even. Because I Bonds pay a rate of return over and above changes in the Consumer Price Index for all Urban consumers (CPI-U), you'll always keep up.