South Platte said:

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tlh3842 said:

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For folks that have done the 10k for a child, do you just make a separate account for your child and use their SSN? Anyone had any issues doing so?

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You log into your account, then add a Minor Account for each kid you want to buy for using their SSN. That's what I've done, but see my post on the bank account issue as far as funding it.

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How is that treated for tax purposes? Is it considered a gift to a minor? Can you just cash it out later and put the money back into your account with no tax implications?

I think that it is subject to the "kiddie tax" rules; essentially the first $2.3K is taxed at the kid's rate (probably zero if this is their only income) and the rest is taxed at the parents'.

https://www.foxbusiness.com/economy/inflation-surged-september-prices-remain-stubbornly-high

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The Labor Department said Thursday that the consumer price index, a broad measure of the price for everyday goods including gasoline, groceries and rents, rose 0.4% in September from the previous month. Prices climbed 8.2% on an annual basis.

Those figures were both higher than the 8.1% headline figure and 0.2% monthly increase forecast by Refinitiv economists, a worrisome sign for the Federal Reserve as it seeks to cool price gains and tame consumer demand with an aggressive interest rate hike campaign.

In an even more concerning development that suggests underlying inflationary pressures in the economy remain strong, core prices which strip out the more volatile measurements of food and energy climbed 0.6% in September from the previous month. From the same time last year, core prices jumped 6.6%, the fastest since 1982.

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https://www.wsj.com/livecoverage/stock-market-news-today-2022-10-13-cpi-report/card/i-bond-rate-will-likely-drop-to-xx-after-cpi-report-c1fyusgIbQ9GlSIN3BxD

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I Bond Rate Will Likely Drop To 6.47% After CPI Report
By Dion Rabouin
Inflation is still hot, but inflation-linked I Bond rates are going down. Today's CPI figure implies that the rate on the U.S. Treasury's Series I Savings Bond will be 6.47% starting Nov. 1unless the Treasury decides to increase it by adding a fixed rate to the bond.
The current rate of 9.62% still applies for all bonds purchased through Oct. 31. Those bonds will earn 9.62% for six months, then switch to the new rate for the next six months.
The I Bond rate formula includes a fixed component on top of the inflation-adjusted rate, but the fixed portion has been 0% since May 2020. It was last above 1% in 2007.
I Bond facts:

• The rate on I Bonds changes every six months, based on six months of inflation data (March to September and September to March).
• So even though year-over-year inflation is still running above 8%, month-to-month inflation has cooled in recent months.
• The 9.62% rate is the highest paid since I Bonds were introduced in 1998.
• More than $22.3 billion worth of I Bonds have been purchased this year through September on the Treasury Department's website. That's already a record high for I Bond gross sales and is more than five times the amount of I Bonds sold in all of 2021, according to data from the Treasury Department.
• I bonds are only available through the U.S. Treasury Department's website, TreasuryDirect.gov, and individual Americans can purchase a maximum of $10,000 per calendar year. They can't be redeemed for at least one year and I Bonds redeemed after less than five years will be penalized the last three months of earned interest.

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New I bond rate for November looks to be ~6.48%. of same 0.8 increase each month, following update would be about 3%. We shall see.

It looks like if you buy I-bonds before Oct 31, you will get 9.62% for 6 months and then about 6.5% for another 6 months, so this should average about 8% for 12 months. Is that about right?

Papa Joe said:

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It looks like if you buy I-bonds before Oct 31, you will get 9.62% for 6 months and then about 6.5% for another 6 months, so this should average about 8% for 12 months. Is that about right?

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You need to factor in keeping them for 15 months. You'd lose the last 3 months of interest on that, but you would still keep the 12 months you're referring to.

Papa Joe said:

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It looks like if you buy I-bonds before Oct 31, you will get 9.62% for 6 months and then about 6.5% for another 6 months, so this should average about 8% for 12 months. Is that about right?

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That looks right to me. Still better than anything else I've got invested. Bought the maximum for wife and me ($20k total) earlier this year and will set a reminder to buy the max again after the first of the year.

Aston 91 said:

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Papa Joe said:

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It looks like if you buy I-bonds before Oct 31, you will get 9.62% for 6 months and then about 6.5% for another 6 months, so this should average about 8% for 12 months. Is that about right?

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That looks right to me. Still better than anything else I've got invested. Bought the maximum for wife and me ($20k total) earlier this year and will set a reminder to buy the max again after the first of the year.

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Agreed. Really glad I made the decision to get in back in April so I get at least 3 periods of good interest. Expect we will get a 4th one starting next May, but no assurance there. Will cash out after 3 months of <5% interest, but anticipate putting in $10k more on January 1.

Just time the stock market.. buy on opening dip today, sell now, made about 4% in 2 hours!

In all seriousness, that's the risk of avoiding risk. Stock market is oversold and undervalued right now by most measures (doesn't mean it won't go lower or promise to recover anytime soon though). But there will likely be significant gains from these levels when it happens. All this to say, don't buy 8% (6% after 3 month penalty) taxable as ordinary income it you are just waiting to get back into the market when things feel better.

If this is money you plan to always keep safe, these are great before November 1, but not after. Just my opinion and forecast... Bookmark this and will see if I was right or wrong

Don't forget that you lolpoors can put another $5k on top of your $10k if you are pulling it from a tax refund.

I love ibonds <3 <3 <3

Can you buy these in a retirement account?

Sea Speed said:

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Can you buy these in a retirement account?

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No. Only at treasurydirect.com.

Roger that, thank you.