I-bonds: Sell or Save

[questions]

I bought several I Bonds in December 2005. Is it more beneficial to me to keep holding them, rather than selling them? Can you explain the fixed rate (what rate is it now)? and the other rate? Do I have to cash them in (after the 5 year period), or continue to own them and earn interest at the current rate? A speedy reply would be greatly appreciated. Thank you

[fruitbowlk]

I have I savings bonds and I'm keeping them part of my housefund. I thought about cashing them in but I don't really need them.

I Bond Earnings Rate of 0.74% includes Fixed Rate of 0.00%
The earnings rate for Series I Savings Bonds is a combination of a fixed rate, which applies for the life of the bond, and the semiannual inflation rate. The 0.74% earnings rate for I bonds bought from November 2010 through April 2011 also will apply for the succeeding six months after the issue date. The earnings rate combines a 0.00% fixed rate of return with the 0.74% annualized rate of inflation as measured by the Consumer Price Index for all Urban Consumers (CPI-U). The CPI-U increased from 217.631 in March 2010 to 218.439 in September 2010, a six-month increase of 0.37%.

Go to TreasuryDirect for all the info on I-Bonds you need.

[jIM_Ohio]

Treasurydirect.gov is probably a good resource for OP

[Marc Prosser]

If you own an I-Bond From 2005 - Don't Sell It

Interest rates on i-bonds have 2 parts 1) a fixed part which stays the same for the life of the bond and variable rate which moves with inflation.

While I don't off the top of my head know what the fixed interest rate on i-Bond was in 2005, my guess is about 2 or 3%. Add that to the current floating rate of 2.20%, you are earning 4 to 5%. An amazing interest rate. You could not cash-in the bond, and find a safe investment that pays that rate of interest.

To find the exact details of for what you are earning and what the bond is worth, you should visit the Treasury Website , Treasury Direct.

[kv968]

I bought several I Bonds in December 2005. Is it more beneficial to me to keep holding them, rather than selling them? Can you explain the fixed rate (what rate is it now)? and the other rate? Do I have to cash them in (after the 5 year period), or continue to own them and earn interest at the current rate? A speedy reply would be greatly appreciated. Thank you

You're getting a fixed rate of 1% but the rate for new bonds has been 0% for about 1 1/2 years now and probably won't 1% any time soon. You don't have to cash them in so if you don't need the money or want to do anything else with it just stick with them.