Series i Bonds

Series i bonds are a type of savings bond issued by the US government to protect investors from inflation. This type of bond is different from an ordinary savings bond, which has a single, fixed rate of interest.

Unlike savings bonds, they have an underlying (low) fixed rate of interest, but also have a floating interest rate added on top. The floating interest rate is indexed to inflation, and serves to protect the investor from inflationary pressures. The advantage of this is that the real value of your principal does not decline.

The floating rate is adjusted every six months in order to account for inflation. This is done in May, and again in November.

Learn about buying series i bonds from the US Government

Series i bonds are sold in many denominations, ranging from $50 to $10,000. They are exempt from state and local taxes, and like Savings Bonds, Federal tax on the bonds can be deferred until maturity.

They can be held for up to 30 years, with a penalty of 3 months of earnings if they are redeemed prior to 5 years.

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