6 Things To Know About Series I Savings Bonds

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Looking for a way to keep your money safe but want to be sure that it outpaces inflation? Series I bonds may be the perfect solution for you.

Here’s What You Need To Know About Series I Bonds

Back in the 1990s, money expert Clark Howard first started talking about Series I savings bonds and how they were a tremendous deal for savers because of the fantastic rates of interest.

“I’ve owned Series I savings bonds since there was an advantageous time period back in the late 1990s. I will hold them all 30 years because the ones that I bought came with two forms of payment: the current inflation rate that resets every six months and a base rate that was the cost of inflation plus a mark up that was generally 3% in the era I bought them.”

But in the early 2000s, the federal government started dropping its fixed rate attached to the bonds, and soon their total interest rate wasn’t worth a whole lot.

Now, because of inflation, Series I bonds are potentially a good place for you to stash cash again. Here’s what you need to know before getting started.

1. How Do Series I Savings Bonds Pay You?

Series I bonds are basically a way to profit from rising inflation. In fact, the “I” in Series I bonds stands for “inflation.” But that’s just half the picture. There are actually two interest rates you earn money from when you buy an I bond:

  1. A fixed rate that never changes for as long as you hold the bond (1.30%)
  2. An inflation rate that changes every six months (1.48%)

Right now, the fixed rate for an I bond sold from May 2024 through October 2024 is 1.30%. This rate will remain constant over the life of the I bond. Then there’s the separate inflation rate, which currently pays 1.48% every six months and changes at the end of that six-month period.

When you combine rates, you’re earning an annual composite rate of 4.28%.

You can keep up to date with the latest Series I savings bond rates through TreasuryDirect.gov.

2. Is Now a Good Time To Buy Series I Bonds?

Clark says now is a good time to put money in a Series I bond, especially when you consider the fixed rate. The fixed rate earns interest over the life of the I bond which Clark likes to call an additional “booster shot” for your savings.

But this is important: Make sure you actively manage your I bonds by staying aware of the interest rate changes.


“One of the effects if inflation does trend down: At these six-month resets, what you earn will change. But compared to interest rates you can earn elsewhere right now, I think putting money into this … is a good idea. Remember, you’re locking in your money for a year.”

3. How Much in I Bonds Can You Buy?

You can buy up to $10,000 of these each year, per person. The minimum investment starts at $25 when you purchase online.

You can also buy savings bonds by using your tax refund. In that case, the minimum starts at $50 and the maximum is $5,000. If you use your tax refund to purchase I bonds, that means the maximum you can buy in a year goes up to $15,000.

4. How Long Can You Hold an I Bond?

Series I bonds reach full maturity after 30 years. That means you stop earning interest on your money at that point. The minimum ownership is one year.

An early withdrawal penalty applies if you cash out an I bond before five years of ownership. The penalty is forfeiture of three months of interest.

5. Where Can You Buy I Bonds?

To buy Series I savings bonds online, simply go to TreasuryDirect.gov and look for the “Savings Bonds” tab on the homepage. Click “Buy a Bond” to find the I Bonds information.

6. Should You Sell Your I Bonds?

If you don’t hold I bonds for at least five years, you forfeit the last 90 days of interest. Clark says that you don’t want to sell during a time when that last 90 days would have been a really high interest rate. If you bought I bonds with a good fixed rate, Clark recommends holding Series I Bonds for a significant period of time unless your financial circumstances change radically.

Clark purchased I Bonds in the 1990s and plans to hold them for 30 years. Think of I Bonds as a tool in your financial toolbox that helps your money grow during times of inflation. You can buy I Bonds in addition to saving money in high-yield savings accounts and Certificates of Deposit (CD).

If you are looking to sell I bonds, Clark has a recommendation:

“There’s a key strategy with I bonds where you have to sell them in the fourth month of when they set to a lower rate. That way, you don’t hit any of the interest you would have earned in that prior six-month period when the inflation rate was higher.”

Final Thought

Series I savings bonds are one tool that may help you achieve long-term financial stability. But Clark warns not to confuse this purchase with investing.


“Putting money in an I bond is not investing,” he says. “It’s a method of saving and it gives you a way of knowing that inflation isn’t eating your money up — because you’re kicking past inflation.”

Questions about Series I Savings Bonds or other money topics? Call Team Clark’s free Consumer Action Center and an experienced volunteer can help: 636-492-5275.