I bond rates will change twice in 2023. In both May and November, the inflation rate will change and the fixed rate may change. This raises a big question: When should you buy I bonds in 2023?
I think the answer depends on whether you are a short-term or a long-term investor.
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ABOUT ME
While still working as a trial attorney in the securities field, I started writing about personal finance and investing In 2007. In 2013 I started the Doughroller Money Podcast, which has been downloaded millions of times. Today I’m the Deputy Editor of Forbes Advisor, managing a growing team of editors and writers that produce content to help readers make the most of their money.
I’m also the author of Retire Before Mom and Dad–The Simple Numbers Behind a Lifetime of Financial Freedom (
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LEARN MORE ABOUT: Treasury Inflation Protected Securities
REVEALED: Best Investment During Inflation
HOW TO INVEST IN GOLD: Gold IRA Investing
HOW TO INVEST IN SILVER: Silver IRA Investing
When Should You Buy I Bonds in 2023?
If you’re looking to invest your money in a safe and secure way, then investing in I bonds might be a good option for you. But before you start buying them, you need to know when the right time to buy I bonds is. In this article, we will discuss when you should buy I bonds in 2023.
First, let’s understand what I bonds are. I bonds are a type of savings bond that is issued by the US Treasury. They are a low-risk investment option that offers a fixed interest rate (determined at the time of purchase) and inflation protection. The rate of return on I bonds is a combination of a fixed rate of interest and an inflation rate. The interest rate is fixed for the life of the bond, but the inflation rate is adjusted every six months to keep up with inflation.
Now let’s talk about when to buy I bonds in 2023. The best time to buy I bonds is usually at the beginning of the month. This is because the interest rate and inflation rate are announced on the last day of the previous month, and the rates are reset on the first day of the new month. So, if you buy your I bonds at the beginning of the month, you will be able to take advantage of the new rates.
Another factor to consider is the inflation rate. If you think that the inflation rate is likely to go up in the near future, then it’s a good idea to buy I bonds. This is because the interest rate on I bonds is adjusted twice a year to keep up with inflation. So, if the inflation rate goes up, the interest rate on your I bonds will also go up, providing you with a better rate of return.
It’s also important to consider your financial goals when deciding when to buy I bonds. If you’re looking for a long-term investment, then it’s a good idea to buy I bonds early on, as they can take up to 20 years to mature. On the other hand, if you’re looking for a short-term investment, then it may be better to look for other options.
In conclusion, the best time to buy I bonds in 2023 is at the beginning of the month when the new rates are announced. You should also consider inflation rates and your financial goals before investing in I bonds. As with any investment, it’s important to do your due diligence before making any decisions.
Keep in mind that you don't have to buy $10,000 of I bonds all at once. You can spread the purchases out over the year. So, for example, you could buy $5,000 before the rate change in May and $5,000 after, thereby hedging your bet on the fixed rate.
Yes stocks are at a discount and things will eventually get better but my monthly living expense is up $3750 from $1600 and I'm left wondering what retirement have in store for me 5years down the line, I'm ill-prepared tbh, my 401k gains are zero-nothing and my stock portfolio?…OH WELL!
<<I'd be retiring or working less in 5 years, and I'm curious to know best how people split their pay, how much of it goes into savings, spendings or investments, I earn around
$250K per year but nothing to show for it yet.
Now that it’s April, do you have an updated recommendation? Also, what about if we followed your suggestion of holding a gift of an Ibond to our spouse last year, should we gift it now?
Thank you Rob so much for the great video explaining I Bonds. Read your book and i have a lot of homework to catch up on 🙂
Will you be making another video once March 2023 CPI-U comes out? I noticed on Keilfp they have Feb and the May 2023 Inflation trent is higher up to 3.26%.
Question/video idea: how to you sell TIPS when purchased from and held by TreasDirect? I mean, follow it all the way to cash in hand.
absurd-where are you login to get a better cheaper inflation hedge long term ?? and you don discuss taxes at all-as long as you hold the bond, you don pay taxes and those monies are REINVESTED instead fo login to uncle sam …its like getting an interest free loan from the IRS.
I’m $100 k over the $250k insured amount in a savings account. I need to do something with that 100 just to be safe. Are short term bonds a good idea? Thanks.
What tips fund do you use for schwab? Or which one do you recommend for a long-term investor
Hi Rob, Thanks for taking the time to make this video. I have a question that I can't find anyone covering on how to handle reporting the interest when holding the I bonds within an LLC. I'm curious how you manage your interest in the account for your LLC. If I record the interest in Quickbooks, it will reflect in both my balance sheet and Profit and Loss. However, since my income is based on the Profit and Loss statement it seems I would be paying taxes on the income now instead of when I redeem the I bonds. Let me know if I'm missing anything, but it seems the two options would be 1) not to recognize the interest until I redeem the bonds. By doing this I would list the initial purchase as an asset in quickbooks. When I eventually redeem the bond I would recognize all the interest and pay taxes on them at that point. 2) Recognize the interest as they are paid by the treasury in quickbooks. By doing this I would be paying taxes on the interest each year. My understanding is there is some extra paperwork or tracking I would need to do in order to keep from paying taxes again when selling the I bonds. All that to say, what are you doing?
coffeezilla in 40 yrs
Is this a good time to buy stocks? I know everyone is saying stocks are at a discount and all, but just how long will It take for us to recover, obviously there are strategies to manoeuvre in this present market but these strategies doesn't come common to the average folk, or am I better off putting my money elsewhere?
Rob, I have an appointment with my CPA in late February. She was really ignorant when I brought up I Bonds on the phone with her today. She said her computer software only allows her to send refund checks to accounts with Routing and Account numbers. Do I Bonds have a routing and account number where the refund check can be deposited? Do I have to set 1 up before any money can be put in it? ….I'm sorry she is so ignorant on this matter. She deals with clients like Lawyers, Doctors, Entertainment people, etc. where 5 or 10 thousand doesn't mean much, like it does to a small investor like me. Thanks for your help.
Never.
Rob, what do you think of TLTW? Based on 20 year treasury Bond Buyright Strategy? It is a new product from Ishares and currently pays 17.75 dividend payment. Thinking of adding it to my JEPI, JEPQ and BSTZ ETFs that I use to supplement my retirement with large dividends. Think it would be nice to have a position in bonds and what happens when fed starts cutting rate in a few months.
will our govt even have any money left?
why use tips w mutual funds w the fees
To my understanding this just proves how much we need an edge as investors because playing the market like everyone else just isn’t good enough. I've been quite unsure about investing in this current market and at the same time I feel it's the best time to get started on the market.
remember folks, Treasury Direct calculates interest different than any other person alive.
The markets are still unsure if the Federal Reserve will continue to its plan to raise interest rates until inflation is under control, despite the fact that bond yields are rising while stock prices are falling. What is the greatest strategy to take advantage of the current bear market while I'm still deciding whether to sell my $401k worth of stocks?
I bonds will divert funds from the retail investments in the equity markets which will increase the risk of a market crash.
So it's not necessarily that I bonds are a bad idea it just sounds like there are better options you could do with all the money you would put in.
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To my understanding this just proves how much we need an edge as investors because playing the market like everyone else just isn’t good enough. I've been quite unsure about investing in this current market and at the same time I feel it's the best time to get started on the market, what are your thoughts?
I stopped buying them when they discontinued issuing the paper ones..just way to confusing to be able to access the one I have that’s only on the computer.
a car is more dangerous
that shark eats microscopic plankton
I'm cashing out my I bonds in May and buying 2 year Treasuries. Inflation is dead.
Easy. Buy AFTER the debt ceiling has been raised.
Why would you buy TIPS when you can get 4% FDIC insured at many online banks or even Merrill Lynch preferred deposit? It’s liquid and FDIC insured.
I have a question for you. If you withdraw from your I-bond, say, in three years, what determines the interest penalty? Is it the interest being paid at that point in time, which in three years might be 3%, or less, or is it an average of the interest rates that you have earned over that three year period?
Why wait until May and lose 4 months interest at 6.89%? If inflation cools so will the return on all the other interest bearing instruments