The U.S. Treasury has set a new Series I savings bond rate of 4.26% for bonds issued between May 1 and Oct. 31. The rate includes a 0.90% fixed component and a 3.34% variable component tied to inflation.
I bonds are designed to protect purchasing power, with the fixed rate locked in for the life of the bond and the variable rate adjusting every six months based on inflation data.
However, investors should consider the trade-offs. I bonds come with a one-year lockup period, and cashing out before five years results in a three-month interest penalty.
While the yield may not match higher-risk investments, I bonds remain a stable, government-backed option for long-term savers focused on preserving value.
#Investing #IBonds #PersonalFinance
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