I bond rates: What are I bonds, and how do you buy them? (2024)

Personal Finance Investing

Written by Sarah Sharkey and Tessa Campbell; edited by Laura Grace Tarpley

I bond rates: What are I bonds, and how do you buy them? (1)

  • What are I bonds?
  • Is an I bond a good investment?
  • Pros and cons
  • FAQs
  • How to purchase I bonds
  • How to redeem I bonds

Paid non-client promotion: Affiliate links for the products on this page are from partners that compensate us (see our advertiser disclosure with our list of partners for more details). However, our opinions are our own. See how we rate investing products to write unbiased product reviews.

  • An I bond is a savings bond issued by the US Department of the Treasury.
  • Rates for I bonds issued between November 1, 2023, and April 30, 2024, have a variable rate of 5.27%.
  • Each year you can purchase up to $10,000 in electronic I bonds and up to $5,000 in paper I bonds.

Similar to corporate organizations, the US government can issue bonds as a way to raise necessary funds. Buyers of Series I Savings Bonds, more commonly referred to as I bonds, enjoy the security of a fixed return plus protection against inflation.

Here's how these bonds work, whether they're a good investment, and how to buy one.

Check out Insider's guide to the best online brokerages>>

What are I bonds?

I bonds are designed to protect your money against the corrosive effect of inflation. Unlike a regular savings bond with a fixed rate, I bond interest rates are regularly adjusted to account for the current inflation rate.

Here's a closer look at the features of this relatively low-risk investment opportunity:

  • Interest rate: The composite rate of an I bond incorporates two separate interest rates — a fixed rate of return that remains stable throughout the life of the bond and a variable inflation rate based on the Consumer Price Index (CPI) that changes twice a year.
  • Interest payments: You don't collect interest payments regularly from an I bond. Interest is earned monthly and compounded semiannually. In other words, your principal is adjusted to include new interest payments twice a year.
  • Amount: You can purchase up to $10,000 in electronic I bonds each calendar year. It's possible to get an additional $5,000 in paper I bonds each calendar year. When combined, you can purchase up to $15,000 in a calendar year. The minimum amount for an electronic or paper I bond is $25 or $50, respectively.
  • Duration: I bonds can earn interest for 30 years unless you cash them in early. You aren't allowed to cash in an I bond within one year of purchase. If you cash in an I bond two to five years out, you'll pay a penalty of three months' interest.
  • Tax benefits: Interest you earn from an I bond is taxable at the federal level, but it's not taxable on a state or local level. You have the option to pay the taxes on an annual basis, when the bond is cashed, or when the bond reaches maturity.

Wealthfront Automated Bond Portfolio

Start investing

On Wealthfront's website


The yield shown is as of 03/07/2024

Earn a 5.50% blended 30-day SEC yield after fee with your personalized portfolio of bond ETFs


0.25% annual management fee


  • Low-cost, 100% portfolio of diverse bond ETFs
  • Great for those who want to invest in low-risk, short-term investments
  • Earns a 5.50% yield
  • Offers automatic dividend reinvesting, portfolio rebalancing, and tax-loss harvesting


  • $500 minimum to open
  • Bond ETFs generally have lower returns compared to other assets
  • Charges a 0.25% annual management fee

Automated Bond Portfolio review External link Arrow An arrow icon, indicating this redirects the user."

Product Details

  • Blended 30-day SEC yield of 5.50%, after Wealthfront's advisory fee.
  • Portfolio is fully managed.

Is an I bond a good investment?

As with all investment choices, whether or not an I bond is a good investment depends on your financial goals and risk tolerance.

Chris Stuart, a financial analyst and portfolio manager at Shorepoint Capital Partners, says I bonds are good for conservative investors who don't need to access their cash any time soon. "I bonds really are meant to be used as long-term investments."

Some savers use I bonds to pay for education for themselves, a spouse, or dependents. If you choose to redeem your I bond and use the funds to pay for qualified education expenses, the interest you earn isn't taxable by the federal government.

I bonds pros and cons

Every investment opportunity has advantages and disadvantages. Here's what to know about I bonds.



  • Interest is guaranteed by the federal government

  • Hedge against inflation

  • No interest penalty if cashed after five years

  • Pay no tax on interest when redeemed to pay for qualified higher education expenses

  • Investment is locked up for the first year
  • Lose three months of interest if cashed in years two through five
  • Can only purchase up to $10,000 in I bonds per year

I bond frequently asked questions (FAQs)

What is the I bond rate?

For I bonds issued between November 1, 2023, and April 30, 2024 Series 1 Savings Bonds offer a variable rate of 5.27%. This I bond rate includes a fixed rate of 1.30%.

When are I bond rates set?

I bond rates are announced by the Treasury on November 1 and May 1 each year.

How often is interest paid on an I bond?

Bonds earn interest monthly, however, interest is compounded every six months.

How to purchase I bonds

I bonds are issued by the U.S. Department of Treasury. You can purchase up to $10,000 worth of I bonds electronically on the TreasuryDirect website. The site requires you to create an account before you get started.

Additionally, you can purchase up to $5,000 worth of paper I bonds annually with your federal tax refund. If you want to pursue this option, you'll need to file IRS Form 8888 with your tax return and indicate an I bond as your preferred payment method.

Public Treasury Account

Open treasury account

Start buying T-bills with Public

Insider’s Rating


Annual Percentage Yield (APY)

Yield is an annualized 26-week T-bill rate (as of 3/8/23) when held to maturity. Rate is gross of fees. T-bills are purchased in increments of $100 par value at a discount; any remaining balance after purchase is held in cash. See disclosures for more information. https://public.com/disclosures


Minimum Opening Deposit



  • If you already invest with Public, you can track all of your investments in one app
  • Link your bank account or making a deposit with your debit card to transfer money into Treasury account


  • Monthly fee of 0.05% based on the average daily balance of your Treasury account; by buying through TreasuryDirect or some large brokers, you won’t pay fees

Product Details

  • Earn a 5.30% Yield with a Treasury Account from Public
  • You can lock in your rate in three steps
  • Treasury bills are exempt from state and local taxes
  • Invest in treasuries for as little as $100
  • Monthly management fee of 0.05% per month based on the average daily balance of your Treasury account which is deducted from your Treasury account on a monthly basis

How to redeem I bonds

If you are holding onto an I bond, you'll want to cash it in at some point. With electronic I bonds, the process is as simple as logging onto your TreasuryDirect account. There's a link within your account to cash your bonds. Funds should arrive in your savings or checking account within two business days.

If you have a paper I bond, you'll likely need to send physical copies to Treasury Retail Securities Services with FS Form 1522. Account holders at some banks have the option to cash paper savings bonds at a branch location.

Check out Insider's guide to the best checking accounts>>

Sarah Sharkey

Sarah Sharkey is a personal finance writer who enjoys helping people make better financial decisions. Sarah enjoys traveling, hiking and reading when she is not writing. You can connect with her on her blogAdventurous Adulting.

Tessa Campbell

Investing and Retirement Reporter

Tessa Campbell is an investing and retirement reporter on Business Insider’s personal finance desk. Over two years of personal finance reporting, Tessa has built expertise on a range of financial topics, from the best credit cards to the best retirement savings accounts.ExperienceTessa currently reports on all things investing — deep-diving into complex financial topics, shedding light on lesser-known investment avenues, and uncovering ways readers can work the system to their advantage.As a personal finance expert in her 20s, Tessa is acutely aware of the impacts time and uncertainty have on your investment decisions. While she curates Business Insider’s guide on the best investment apps, she believes that your financial portfolio does not have to be perfect, it just has to exist. A small investment is better than nothing, and the mistakes you make along the way are a necessary part of the learning process.Expertise:Tessa’s expertise includes:

  • Credit cards
  • Investing apps
  • Retirement savings
  • Cryptocurrency
  • The stock market
  • Retail investing

Education:Tessa graduated from Susquehanna University with a creative writing degree and a psychology minor.When she’s not digging into a financial topic, you’ll find Tessa waist-deep in her second cup of coffee. She currently drinks Kitty Town coffee, which blends her love of coffee with her love for her two cats: Keekee and Dumpling. It was a targeted advertisem*nt, and it worked.

Top Offers From Our Partners

I bond rates: What are I bonds, and how do you buy them? (6)

SoFi Checking and Savings Earn up to 4.60% APY on savings balances and up to a $300 bonus with qualifying direct deposit. FDIC Insured.

There is no minimum direct deposit amount required to qualify for the 4.60% APY for savings. Members without direct deposit will earn up to 1.20% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Interest rates are variable and subject to change at any time. These rates are current as of 10/24/2023. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet. To earn the $300 bonus, the customer must complete a direct deposit with a minimum initial deposit of $250 in a new SoFi Checking and Savings account within 45 days of clicking to qualify (offer expires 12/31/24).

Editorial Note: Any opinions, analyses, reviews, or recommendations expressed in this article are the author’s alone, and have not been reviewed, approved, or otherwise endorsed by any card issuer. Read our editorial standards.

Please note: While the offers mentioned above are accurate at the time of publication, they're subject to change at any time and may have changed, or may no longer be available.

**Enrollment required.


I bond rates: What are I bonds, and how do you buy them? (7)

Sign up to get the inside scoop on today’s biggest stories in markets, tech, and business — delivered daily. Read preview

I bond rates: What are I bonds, and how do you buy them? (8)

Thanks for signing up!

Access your favorite topics in a personalized feed while you're on the go.

I bond rates: What are I bonds, and how do you buy them? (9)

I bond rates: What are I bonds, and how do you buy them? (2024)
Top Articles
Latest Posts
Article information

Author: Delena Feil

Last Updated:

Views: 5729

Rating: 4.4 / 5 (45 voted)

Reviews: 92% of readers found this page helpful

Author information

Name: Delena Feil

Birthday: 1998-08-29

Address: 747 Lubowitz Run, Sidmouth, HI 90646-5543

Phone: +99513241752844

Job: Design Supervisor

Hobby: Digital arts, Lacemaking, Air sports, Running, Scouting, Shooting, Puzzles

Introduction: My name is Delena Feil, I am a clean, splendid, calm, fancy, jolly, bright, faithful person who loves writing and wants to share my knowledge and understanding with you.