Series I bonds rate could top 5% in November. Here’s what to know

larryhw | iStock / 360 | Getty Images

The annual rate for newly bought Series I bonds could top 5% in November — and there are several things to consider before adding more to your portfolio, experts say.  

November’s rate for new purchases could be higher than the current 4.3% interest on I bonds bought through Oct. 31, leaving some investors wondering about whether to buy more.

“It’s definitely worth it to wait until November” to decide, said Ken Tumin, founder and editor of, which tracks I bonds, among other assets.

More from Year-End Planning

Here’s a look at more coverage on what to do finance-wise as the end of the year approaches:

The U.S. Department of the Treasury updates I bond rates every May and November and there are two parts to I bond yields: a variable and fixed portion.

The variable rate adjusts every six months based on inflation and the Treasury can also change the fixed rate or keep it the same. (The fixed rate stays the same for investors after purchase, and the variable rate adjusts every six months based on the investor’s purchase date.)  

Based on inflation, the variable rate in November will likely increase to 3.94% from 3.38%. But the current 0.9% fixed rate could also increase, based on yields from 10-year Treasury inflation-protected securities, or TIPS, according to David Enna, founder of, a website that tracks I bond rates and TIPS.

Former Atlanta Fed President Dennis Lockhart: There's a disinflationary trend underway

Higher fixed interest could be attractive to longer-term investors, experts say. But they’d need to purchase new I bonds between Nov. 1 and April 30 to score the increased fixed rate.

Other competitive short-term options

While I bonds remain an attractive option for long-term investors, the choice may be harder for shorter-term goals, experts say.

One of the downsides of newly purchased I bonds is you can’t access the money for at least one year and you’ll lose three months’ interest by tapping the money within five years. 

However, there are other competitive options for cash with more liquidity, such as high-yield savings accounts, certificates of deposit, Treasury bills or money market funds.

If you can get the top rate, one-year CDs are a better deal.

Ken Tumin

Founder and editor of

Currently, the top 1% average for high-yield savings accounts is 4.92%, and the top 1% average for one-year certificates of deposit is 5.72%, as of Oct. 16, according to

Short-term cash in high-yield savings accounts could outperform I bonds when factoring in the three-month interest penalty, Tumin said. “And if you can get the top rate, one-year CDs are a better deal,” he said.

Meanwhile, one-month to one-year Treasury bills are offering well above 5%, as of Oct. 16, and the biggest money market funds are paying interest in a similar range, according to Crane data.

Source link

Share with your friends!

Leave a Reply

Your email address will not be published. Required fields are marked *

Get The Best Financial Tips
Straight to your inbox

Subscribe to our mailing list and get interesting stuff and updates to your email inbox.

Thank you for subscribing.

Something went wrong.