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If you're trying to max out the yearly purchase limit for Series I bonds, your tax refund offers an opportunity to buy even more. An inflation-protected and nearly risk-free investment, I bonds are currently paying 6. Buying paper I bonds with your tax refund may make sense if you're eager to purchase as much as possible, said Ken Tumin, senior industry analyst at LendingTree and founder of DepositAccounts. com , a website that tracks I bonds , among other assets. There are two parts to I bond interest: a fixed rate, which may change every six months for new purchases but stays the same after the bonds are bought , and a variable rate, which changes every six months based on inflation.
TreasuryDirect announces new rates every May and November. But with inflation falling , Tumin said, I bond investors "might be a little bit disappointed in May," noting the combined rate may drop below the past three updates — 6. As the Federal Reserve continues to raise the target federal funds rate , other assets have become more attractive, experts say. For shorter-term goals, Keil points to assets such as Treasurys, high-yield savings accounts or certificates of deposit, with rates that have crept up over the past year. He said shorter-term CDs are paying higher rates than longer-term CDs because many institutions are expecting the Fed to start cutting rates in a year or so.
Keil said it's also important to consider the downsides of purchasing paper I bonds tied to your tax return. What's more, paper I bonds must be converted to electronic form before redemption. Minneapolis Fed President: I'm not sure we've done enough to bring the labor market into balance. is 'absolutely behind' on supply chain independence for rare earth minerals: special presidential coordinator. India oil minister says country will source crude from wherever it has to and on beneficial terms. Chamber of Commerce's Suzanne Clark on regulatory priorities post-midterms. money Today My Watchlist Markets Investing Personal Finance Real Estate Careers Small Business Mortgages Savings Rates Personal Loans Tools.
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