November 1, 2021
Jeremy Keil predicts that the next 6 months may be the best time ever in history to buy I Savings Bonds with the breaking news that the November 2021 I bond inflation rate will be 7.12%, which is 3.56% earned over 6 months.
Compare that rate to the current US 12-month Treasury Bill rate of 0.12% and the I bond rate is almost 3.5% higher. The average difference between the 6-month I bond and the 12-month T-Bill is 0.31% in favor of the T-Bill. Only one other time in history has the I bond rate even been 2.0% better (May 2011) and right now it sits at almost 3.5% better!
This rate also compares favorably to many alternatives like savings accounts, CDs and money markets that are all stuck well below 1.0% right now.
U.S. Series I Savings Bonds, also known as I Bonds, are a type of U.S. government savings bond that offer a fixed interest rate, plus an inflation-adjusted rate. These two rates combine to form a “composite rate.” Due to the inflation-adjusted component, the real interest rate (net of inflation) can never be negative. In simple terms, this means that I Bonds can keep money from losing value every day due to inflation!