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Post by minnesotapaintlady on Apr 12, 2022 7:59:41 GMT -5
New variable rate: 9.62%!!!
Man I wish I had more money to throw that way...
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susana1954
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Post by susana1954 on Apr 12, 2022 11:06:23 GMT -5
New variable rate: 9.62%!!!
Man I wish I had more money to throw that way...
It went up because I bought one. Lol. |
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Post by minnesotapaintlady on Apr 12, 2022 11:16:59 GMT -5
New variable rate: 9.62%!!!
Man I wish I had more money to throw that way...
It went up because I bought one. Lol. You'll still get the higher rate, you just have to wait 6 months. You'll get 6 months at 7.12 and 6 months at 9.62. Over 8% average for the year, not too shabby! |
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seriousthistime
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Post by seriousthistime on Apr 12, 2022 11:54:59 GMT -5
New variable rate: 9.62%!!!
Man I wish I had more money to throw that way...
Wow! I should have some that reset in June and others that reset in July. |
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Rukh O'Rorke
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Post by Rukh O'Rorke on Apr 12, 2022 12:41:39 GMT -5
New variable rate: 9.62%!!!
Man I wish I had more money to throw that way...
holy crap! |
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Rukh O'Rorke
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Post by Rukh O'Rorke on Apr 12, 2022 12:57:18 GMT -5
for like, the 100th time, wish I'd heard about these sooner....still under 20k in total in ibonds....
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Post by minnesotapaintlady on Apr 12, 2022 13:01:30 GMT -5
for like, the 100th time, wish I'd heard about these sooner....still under 20k in total in ibonds.... Countrygirl has been talking about them for years but nobody was interested when they were paying 1-2%. |
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saveinla
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Post by saveinla on Apr 12, 2022 13:05:47 GMT -5
New variable rate: 9.62%!!!
Man I wish I had more money to throw that way...
Is there any reason to not put some in kids names - if funds are needed for the near term. This is only for kids who are not interested in money and hopefully will not cash them out without the parent knowing  |
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Post by minnesotapaintlady on Apr 12, 2022 13:08:10 GMT -5
New variable rate: 9.62%!!!
Man I wish I had more money to throw that way...
Is there any reason to not put some in kids names - if funds are needed for the near term. This is only for kids who are not interested in money and hopefully will not cash them out without the parent knowing No. Besides that it's locked in for a year and you lose 3 months interest if cashed in before 5 years. |
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plugginaway22
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Post by plugginaway22 on Apr 12, 2022 13:14:25 GMT -5
For once it pays to procrastinate! I still have not purchased any in 2022. How long do I have before the next rate change, is it quarterly?
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Post by minnesotapaintlady on Apr 12, 2022 13:16:04 GMT -5
For once it pays to procrastinate! I still have not purchased any in 2022. How long do I have before the next rate change, is it quarterly? I would buy before the rate changes on May 1st, that gets you 8.4% for the next year. Next rate change is in November. |
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Rukh O'Rorke
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Post by Rukh O'Rorke on Apr 12, 2022 15:57:37 GMT -5
for like, the 100th time, wish I'd heard about these sooner....still under 20k in total in ibonds.... Countrygirl has been talking about them for years but nobody was interested when they were paying 1-2%. Yeah - I just wasn't in a place for conservative investing until the pass few years. I guess I'll have to take my lumpy stock gains and deal with it.  |
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Rukh O'Rorke
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Post by Rukh O'Rorke on Apr 12, 2022 17:59:07 GMT -5
For once it pays to procrastinate! I still have not purchased any in 2022. How long do I have before the next rate change, is it quarterly? I would buy before the rate changes on May 1st, that gets you 8.4% for the next year. Next rate change is in November. you said that last time but would have been better to wait..... |
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Post by minnesotapaintlady on Apr 12, 2022 18:11:40 GMT -5
I would buy before the rate changes on May 1st, that gets you 8.4% for the next year. Next rate change is in November. you said that last time but would have been better to wait..... There's no way it's better to wait unless there's a chance the fixed rate would go up and the consensus of opinion everywhere is it's not budging from 0 and even if it did it would just be a small increase which would take a LONG time to make up for the loss of the 7.12% if the variable drops down to a more normal 2-3% come November. eta: Even the article I linked above says don't wait... "While waiting for the May 1 reset might look tempting to launch directly into the 9.62% rate, I still strongly recommend buying I Bonds before April 30, which will lock in a 7.12% rate for a full six months, followed by 9.62% for six months. That’s an annual rate of about 8.4%, and there is no other very safe investment that can match that return." |
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Post by minnesotapaintlady on Apr 12, 2022 18:16:25 GMT -5
I learned a neat trick today. I've been tracking my paper bonds with the TD online calculator. You just input them all and save the page as an HTML doc on your computer somewhere, then when you open the web page and hit "Return to Calculator" it gives you the value of all your paper bonds as of that day. Well, someone mentioned to me that he also inputs his electronic bonds, just puts "Electronic" where the serial number goes. That way you never have to log into the site to check bond values, they're just all right there with a couple clicks. The only snafu is it refuses to recognize bonds with a value larger than $1000 since that's the largest denomination you can get in paper, so I just had to break down my 10K bonds into 10 1K ones. It works really slick.
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CCL
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Post by CCL on Apr 12, 2022 18:49:01 GMT -5
Do you have to pay income tax on the interest? I've thought about jumping in, but I'd have to take the money from my brokerage account, which normally has a 0% capital gains rate. If I take out that much at once, it will either raise my rate or cause me to not be able to convert to Roths this year. Decisions...
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Post by minnesotapaintlady on Apr 12, 2022 19:05:26 GMT -5
Do you have to pay income tax on the interest? I've thought about jumping in, but I'd have to take the money from my brokerage account, which normally has a 0% capital gains rate. If I take out that much at once, it will either raise my rate or cause me to not be able to convert to Roths this year. Decisions... Federal not state and only when you cash them in. They can accrue interest for 30 years without you ever having to do anything about it. I don't think I'd take money out of investments to put in I bonds, especially if it's going to mess up your tax situation. I just had a pile of cash sitting around earning nothing. |
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CCL
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Post by CCL on Apr 12, 2022 20:23:47 GMT -5
Hmmm... I was thinking I could use the interest for spending money at some point. That's probably not the best way to use them.
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aricia
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Post by aricia on Apr 13, 2022 7:28:43 GMT -5
Is there any reason to not put some in kids names - if funds are needed for the near term. This is only for kids who are not interested in money and hopefully will not cash them out without the parent knowing No. Besides that it's locked in for a year and you lose 3 months interest if cashed in before 5 years. I bought some in my kids’ names. They are 8 and 13 and the one year lock up is not an issue since I still pay for most of their stuff anyways! Even losing 3 months interest provides a much better return than the savings accounts their money was sitting in. I used THEIR money to buy them so if they cash it out and spend it some day it’s no different than they could have done anyways. The older one has about $1000 and the younger one has less. The older one loves the idea of having her money earn more and was all for it! She still has some spending money available if she wants to use it. She rarely does. |
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susana1954
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Post by susana1954 on Apr 13, 2022 8:07:59 GMT -5
Do you have to pay income tax on the interest? I've thought about jumping in, but I'd have to take the money from my brokerage account, which normally has a 0% capital gains rate. If I take out that much at once, it will either raise my rate or cause me to not be able to convert to Roths this year. Decisions... Federal not state and only when you cash them in. They can accrue interest for 30 years without you ever having to do anything about it.
I don't think I'd take money out of investments to put in I bonds, especially if it's going to mess up your tax situation. I just had a pile of cash sitting around earning nothing. That is a personal choice. You can choose to pay the interest as it accrues, which may prevent a large tax hit when you do cash them in. The only thing is that once you do start choosing to pay the interest as it accrues, you have to continue to do that. I pay now. |
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Post by minnesotapaintlady on Apr 13, 2022 8:20:48 GMT -5
Federal not state and only when you cash them in. They can accrue interest for 30 years without you ever having to do anything about it.
I don't think I'd take money out of investments to put in I bonds, especially if it's going to mess up your tax situation. I just had a pile of cash sitting around earning nothing. That is a personal choice. You can choose to pay the interest as it accrues, which may prevent a large tax hit when you do cash them in. The only thing is that once you do start choosing to pay the interest as it accrues, you have to continue to do that. I pay now. True. Most people don't do that though. I plan on using the I bonds to bridge me to SS and probably won't have to pay any taxes on interest. |
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souldoubt
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Post by souldoubt on Apr 13, 2022 10:24:43 GMT -5
you said that last time but would have been better to wait..... There's no way it's better to wait unless there's a chance the fixed rate would go up and the consensus of opinion everywhere is it's not budging from 0 and even if it did it would just be a small increase which would take a LONG time to make up for the loss of the 7.12% if the variable drops down to a more normal 2-3% come November. eta: Even the article I linked above says don't wait... "While waiting for the May 1 reset might look tempting to launch directly into the 9.62% rate, I still strongly recommend buying I Bonds before April 30, which will lock in a 7.12% rate for a full six months, followed by 9.62% for six months. That’s an annual rate of about 8.4%, and there is no other very safe investment that can match that return." I made the max purchase for myself in March and was debating whether or not to wait for May 1st to do the same for my wife. Yesterday I came to the same conclusion as you/the article that I'm overthinking it and getting the 8%+ guaranteed for the 12 months I can't sell the bonds is something I shouldn't wait on. Obviously at some point inflation will come down and if I'm holding the bonds still when it does and the rate drops below the 7.12% being paid now I'm going to be glad I had those first 6 months at that higher rate. I also looked at a chart of the fixed rate over the years and don't think it will go up just yet but even if it does it will be an immaterial amount. |
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Post by minnesotapaintlady on Apr 13, 2022 10:50:34 GMT -5
There's no way it's better to wait unless there's a chance the fixed rate would go up and the consensus of opinion everywhere is it's not budging from 0 and even if it did it would just be a small increase which would take a LONG time to make up for the loss of the 7.12% if the variable drops down to a more normal 2-3% come November. eta: Even the article I linked above says don't wait... "While waiting for the May 1 reset might look tempting to launch directly into the 9.62% rate, I still strongly recommend buying I Bonds before April 30, which will lock in a 7.12% rate for a full six months, followed by 9.62% for six months. That’s an annual rate of about 8.4%, and there is no other very safe investment that can match that return." I made the max purchase for myself in March and was debating whether or not to wait for May 1st to do the same for my wife. Yesterday I came to the same conclusion as you/the article that I'm overthinking it and getting the 8%+ guaranteed for the 12 months I can't sell the bonds is something I shouldn't wait on. Obviously at some point inflation will come down and if I'm holding the bonds still when it does and the rate drops below the 7.12% being paid now I'm going to be glad I had those first 6 months at that higher rate. I also looked at a chart of the fixed rate over the years and don't think it will go up just yet but even if it does it will be an immaterial amount. The only way I can see MAYBE waiting is if you're pretty sure you're only holding them for 12 months...not 15...just 12. Then you get the 9.62% for the full 6 months and 3 months of whatever the next mystery rate is. Otherwise you're losing 3 months at 9.62% cashing them in at the one year mark. You STILL might come out ahead buying before the reset in this case depending on what the next rate is, but if you're just focused on guaranteeing that 9.62% for 6 months...
Unless there is an emergency where I need to tap it, my plans are a minimum of 5 years. The variable will certainly return to the 2-3% range long before that.
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Tiny
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Post by Tiny on Apr 13, 2022 14:47:43 GMT -5
Hmmm... I was thinking I could use the interest for spending money at some point. That's probably not the best way to use them. The going wisdom is it makes NO SENSE to pull money out of investments to buy IBonds. It makes NO SENSE to not continue to fund any other tax advantaged accoutns - if you are still in the "accumulation" phase of life. Basically, Fear Of Missing Out is not a good reason to buy IBonds.  that said - IBonds might be a good place to put some Emergency Fund money... That's pretty much what I did - moved EF $$ as CDs came due to IBonds. In hindsight - I probably should have started moving the EF from the CDs a couple two three years ago when interest rates went under 1%. My EF $$ have been losing value in CDs for a lot of years... due to low inflation. I keep forgetting that part about where IBonds keep up with inflation. So your money doesn't loose value overtime. (I guess you do loose some value - cause you have to pay taxes on the interest - but it's gotta be better than .5% or less on money in a HSYA or CD... ) |
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CCL
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Post by CCL on Apr 13, 2022 14:59:25 GMT -5
I wouldn't say we are in the "accumulation" phase. Hubby's been retired for 9 years. We are still sorta young, though, so need our money to last a while.
I'm probably better off keeping my money where it's at.
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countrygirl2
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Post by countrygirl2 on Apr 13, 2022 18:49:18 GMT -5
I need to buy some but so limited in the amount we can. I got lucky back when I bought them and also got the fixed component in quite a few that really jacks up the interest. I think on my initial investment of $65k this years interest is looking like $8k or so. They are up to about $136k now in value. I didn't pay the taxes annually as I thought it would be a pain to keep up with, likely should have. Guess I will just have to do it when cashed. These will be one of the last things to go. Most will still be earning money in 2030, I can only imagine the value then.
Even better is the $1200, seems like it was that much I put in Walmart stock many years ago, its now worth $30k and I have just let the dividends and interest accumulate through the years. I look at them once a year when I get my tax papers. But the taxes have been paid on those through the years.
Hubs says sell this stuff, I said are you nuts my little investments are doing better than anything he has, jeez.
We may need them in our very old age, if not will pass on to the kids in time.
With the national debt we have, I really don't see the interest rates coming down that much, so think the I's will continue to be a good investment.
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azucena
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Post by azucena on Apr 14, 2022 3:13:49 GMT -5
MPL - has anyone told you lately that you so smart? I feel like I learn from you in many threads including this one.
Ibonds are the perfect choice for someone like me who sleeps better at night (not tonight given I am posting at 3 am, insomnia SMH) with an emergency fund of $100k. This balance was sitting in "preferred" customer savings account earning 0.07% interest. Made me crabby every month to see the interest post.
Pretty sure I can remember the late 80s when my 8-10 yo self had a green savings account pass book that I would save my meager chore money, bday money, and anything else I could scrounge up. I'd pester my mom to give me the monthly statement when it came in the mail so I could update the ledger myself and watch my money grow on its own. Seems like the interest rate was 8%, someone correct me if that doesn't sound right. So even on a balance of say $300, it was noticeable growth esp for a 10 yo proud to deposit $10 at a time. The tellers would always chuckle about my own written in numbers. Numbers nerd and YMer - clearly both are my nature tendencies LOL.
Meanwhile, I'm having a hard time getting even my saver kid who is now 13 to be interested in her savings account. Literally no difference between it and the wallet she wants to hoard her money in. Trying a new tactic to mimic 401ks. She deposits $x and I match 50% of x. Ah, now we're getting somewhere! Blessed to be able to do that exercise with her. Have explained it in parallel to 401k to her and she's listening. Have in mind to fund roth for her when she starts a w2 job. And will show her the spreadsheet I'll make to project possible growth of starting that habit at ages 15-17.
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azucena
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Post by azucena on Apr 14, 2022 3:20:40 GMT -5
Both ideas wouldn't have been on my radar if I hadn't been learning from posts like these.
Back to the ibond discussion. DH and I moved $20k total in Dec, and I was debating doing another $20k now. Was feeling wishy-washy about it after our 6 month follow up with our first investment advisor. She wasn't thrilled with the idea but concluded that I wasn't her only client doing so and it wasn't the worst idea. She thought it should be in the market and isn't quite tuned in to our risk tolerance for so much savings due to DHs health issues. Pretty sure in his 17 surgeries, I've used unpaid FMLA leave 8 times over almost 20 yrs. That will shift the equation.
And at our current savings rate of $30k/yr based on the past 3-4 yrs now that we've hit the $100k goal I'd set for our liquid savings, we're going to continue to need space to house savings and make it earn at least a little something for us. Something less than pennies LOL.
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azucena
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Post by azucena on Apr 14, 2022 3:33:56 GMT -5
Breaking up long posts so the proboards bear doesn't eat them:) MLPs latest post updating the interest rate cemented my decision. Will tell DH to move $20k tomorrow leaving our liquid savings around $50k which feels about right. On a related note, our church school had a building campaign about 5 yrs ago and took on a multi-million dollar loan from a church lending institution. There was a follow up request for church members to open up new CDs with this place and if we hit a certain number of new accounts they would knock off 0.5% of the interest charged to the loan. Significant savings, amount was posted in the bulletin. Anyway, this coincided with my crabbiness about savings account interest as we hit the $50kish mark. So DH and I decided to move over $10k. Well the 4-5 yr window passed and that $10k now sits at almost $1200. Insomnia starting to subside bc the interest rate, term, and exact numbers escape me - sleep is coming. Anyway, we are kicking ourselves for not being brave enough to put in $20k and I've been watching for them to make a similar offer but it won't happen again. Institution was lcef - lutheran church extension fund if anyone is curious. I thought about posting the deal here at the time but was like nah, small potatoes. I'm starting to make the brain leap to thinking hey, I might actually know enough to be a money mentor here and other places LOL. See you in the morning  |
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CCL
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Post by CCL on Apr 14, 2022 4:30:14 GMT -5
azucena Did you mean the $10k is now $12k or the total in interest is now at $1200?
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