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A comment on I Bond’s variable rate will rise to 9.62% with the May reset. Parent comment

Re:I Bond’s variable rate will rise to 9.62% with the May reset by gizmo686 on Tuesday April 12, 2022 @05:08PM (#31008252)
No. There is a reason you are limited to $10k a year. I bonds are not a financial product being sold for the benefit of the seller. They are a government service being provided for the benefit of the buyer.
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Re:I Bond’s variable rate will rise to 9.62% with the May reset by gotaquestion on Tuesday April 12, 2022 @05:50PM (#31008659)
Kinda sound like a wanker here, but if I can only by $10k of bonds... that works out to about $500 after taxes in a year. Not a whole heck of a lot, or do they retain the 8% for however long you hold the bond? (e.g., 10 years?) Meaning at 7.2% in 10 years I'd have 20k?

EDIT: Thanks for the replies. TIL.

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Re:I Bond’s variable rate will rise to 9.62% with the May reset by zeroonetwothree on Tuesday April 12, 2022 @05:56PM (#31008712)
No they have a rate that adjusts to match inflation. So after 10 years you will have exactly the same amount as you started with in real dollars (actually less because of taxes...)
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Re:I Bond’s variable rate will rise to 9.62% with the May reset by pedrosorio on Tuesday April 12, 2022 @06:01PM (#31008779)
> that works out to about $500 after taxes in a year.

https://www.thebalance.com/tax-advantages-of-series-i-saving...

1) No state tax on I-bonds

2) You can defer and pay tax on the interest only when you sell the bonds (which means you can time the sale to when you have lower income)

> or do they retain the 8% for however long you hold the bond?

No, the interest rate is updated every 6 months, see the sibling comment.

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Re:I Bond’s variable rate will rise to 9.62% with the May reset by gizmo686 on Tuesday April 12, 2022 @05:57PM (#31008728)
The bonds last up to 30 years, and you can buy the yearly max every year regardless of how much you own. However, they do not have a fixed interest rate. Every 6 months, the rate is set to match inflation.
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Re:I Bond’s variable rate will rise to 9.62% with the May reset by armchair_ on Tuesday April 12, 2022 @06:07PM (#31008834)
The interest rate gets changed every 6 months depending on the CPI. The $10k limit is per year - so if you hold on to those bonds you can potentially have $300k invested in total.

As the parent comment stated - this isn't meant to get anyone rich. This is the government providing a service that allows (working-class) individuals to keep a rainy-day fund relatively insulated from risk. If you're able to save more than 10k per year, you're not the primary target for this service.

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Re:I Bond’s variable rate will rise to 9.62% with the May reset by atwebb on Tuesday April 12, 2022 @05:59PM (#31008751)
The second one (but in theory it is still that same purchasing power since it is keeping with inflation).

There's some rules on if you cash out before 5 years (you give up the last 3 months of interest) and you MUST hold for 12 months.

You can ladder them too and have different amounts / times of purchase.

I like it for planned emergency funds that would otherwise be cash, ladder into it so you always have your EF available.

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Re:I Bond’s variable rate will rise to 9.62% with the May reset by cplex on Tuesday April 12, 2022 @06:57PM (#31009235)
“Not a whole heck of a lot” but at virtually zero risk. This is for the portion of your portfolio that you don’t risk at all.
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