This video is for those of you who are or are planning to get out of I-Bonds now that we know the May 1st variable rate is projected to drop to 3.38%. So, when is the “best” time to redeem your I-Bonds & how do you redeem your I-Bonds (step-by-step) as always – that’s what I’ll be talking about in today.
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WATCH NEXT
⭐ Why We’re Buying More 5.4% I-Bonds In 2023:
⭐ I-Bond Gifting 101:
⭐ Buy I-Bonds Or TIPS In 2023:
⭐ Best Money Market Funds vs Cash 2023:
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I Bonds are a type of savings bond issued by the United States Department of the Treasury. They come with a fixed rate of return plus an inflation rate that adjusts twice a year based on changes in the Consumer Price Index. I Bonds are an attractive investment option for those seeking a low-risk investment with the potential for inflation protection.
If you hold I Bonds that were issued in 2023, you may be wondering when and how to redeem them. Here are some important things to keep in mind:
1. When Can You Redeem I Bonds 2023?
I Bonds earn interest for 30 years from the issue date. However, they can be redeemed at any time after 12 months from the issue date. This means that if your I Bonds were issued in 2023, you can start redeeming them in 2024.
If you redeem I Bonds before five years from the issue date, you’ll forfeit the last three months of interest. After five years, you can redeem them penalty-free.
2. How to Redeem I Bonds 2023?
Redeeming I Bonds is a straightforward process. You can redeem your bonds online through the TreasuryDirect website or by visiting a local bank, financial institution, or a Federal Reserve Bank.
To redeem your I Bonds online, you’ll need to create an account on the TreasuryDirect website. Once you’re logged in, you can select the I Bonds you wish to redeem and follow the prompts to initiate the redemption process.
If you prefer to redeem your I Bonds in person, you’ll need to provide identification, such as a government-issued ID, and information about the bonds you want to redeem. After verifying your identity, the financial institution will initiate the redemption process.
3. What Are the Tax Implications of I Bond Redemption?
When you redeem I Bonds, you’ll receive the face value of the bond plus any accrued interest. The interest earned on I Bonds is subject to federal income tax, but exempt from state and local income taxes.
You can choose to report the interest on your tax return annually or defer taxes until the year of redemption or maturity. If you have questions about the tax implications of redeeming your I Bonds, consult a tax professional.
In conclusion, redeeming your I Bonds 2023 is a simple process that can be done online or in person. Keep in mind the penalty for redeeming before five years from the issue date and the tax implications of redemption. If you’re unsure whether to redeem now or wait for a future date, consult a financial advisor to make an informed decision based on your individual financial goals and circumstances.
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> > WATCH NEXT < <
⭐ Why We're Buying More 5.4% I-Bonds In 2023: https://youtu.be/hwBPBWRht3I
⭐ I-Bond Gifting 101: https://youtu.be/bSoZJJypSAQ
⭐ Buy I-Bonds Or TIPS In 2023: https://youtu.be/JKbvtdcsPSM
⭐ Best Money Market Funds vs Cash 2023: https://youtu.be/N53wZ_80abU
Great information. Thanks.
Are there any US banks, credit unions, or investment houses that still are redeeming these bonds???
Thank you for this video. My bond will be 1 year old May 10th , so I know now to redeem on August 10th. Thanks again young lady. Sincerely Yours; Bill….
Can you do a video on when it makes sense to redeem old bonds (after 12 months but under 5 years), lose the 3 months interest and buy new bonds to capture the new fixed rate of .9%?
Thank you so much for your time for showing us this step by step process of withdrawing from an I-Bond account. You made it look so easy to do.
Thank you so much !! Very, very helpful, as usual for you ! So glad I found your channel (and subscribed, of course).
Thank you for your clear step by step explanation. It is greatly appreciated.
Thank you for the clear recommendations on when and how to redeem iBond. It saves me a lot of time and still miss the best opportunity to redeem if I struggle through on my own.
Definitely getting out of i-bonds, thank you for this video!
Any pros or cons of having treasury direct do the tax withholding for you? Is this explained in any of the videos? thanks!
Why buy more when earning rates are going plummet in May?
You always privide super useful information – thank you!
The I-Bond Owner should never sell them unless they have an Emergency Need. I have been invested in I-Bonds for 25 Years, and they have more than Doubled in Value. I-Bonds are part of my Investment Strategy, with CD Ladders, etc…
Your videos are always so easy to follow and very educational! Thank you for sharing and for your expertise. I’m a fan!!
If I buy the maximum amount of i-bonds this year, can I buy another maximum amount next year?
How about redeeming the The I-Bond check from tax return?
Does your husband have a finance background as well? Ty for doing all these videos, they've been really helpful over the past months. Also, are you planning to just hold the ibonds for the full 5 years?
That whopping $1.42…that will put you into the next tax bracket, for sure! Thanks for another great video!
I have two I-Bond blocks. One with a fixed interest rate and one without a fixed interest rate. The only I-Bond that I will redeem is the one without a fixed interest rate. I'll likely redeem it to use that money to buy a new I-Bond that has a fixed interest rate. I-Bonds are a very tiny portion of my total money, so I plan to keep them for as long as I can.
Fidelity money market rate is annualized 4.5% now, compounded monthly, I don't see the reason to continue to hold I bond when its rate is under 4%.
Jennifer，can you please do a video on T-notes? Is it worth to invest? Comparing with t- bills and cds what’s pros and cons? Thanks
For ibonds purchased in May 2022, what date should I sell them in order to hold them for the three months of lowest interest? Aug 1st 2023? Sept 1st 2023? Exactly 3 months beyond the original purchase date such as 4/5/22 purchase date and 8/5/2023? Other?
Your meticulous and crystal clear explanations are so valuable to me and my family. Since 7.12%, I have gradually moved our family's entire emergency fund as well as other mid-term savings (time horizon: 2-3 years) into i-bonds, and this video helps me plan the next steps as I partially liquidate. I hope this tip balances out the returns you negated by redeeming your $25 of bonds for educational purposes. 🙂 Thanks again!
I mean t to say Synchrony Bank
Synchronu Bank is offering FOURTEEN MONTHS CD'S AT 5.15% INTERES…. your comments please……
I will be able to redeem my I bond 10k upon one year maturity this coming June. Moreover, i also have the gift of 10k from my my spouse which will be matured one year at the same time frame June 2023. Can I redeem both I bonds in June? Thanks
So if you redeem a portion, does the rest continue to earn interest? Do you only lose 3 months worth of interest on just the portion you redeem? 25 bucks in your example.
I boughy my first i-bonds last May. The full amount. If I buy before end of April, will the new i-bonds get the current rate of 6 something per cent for 6 months before dropping to 3 plus per cent?
I thought we can redeem without penalty if used for qualified education expenses, correct?