Skip Ahead Here! 0:00 - I Bonds Explained! (Is 7.12% Guaranteed for Real?) 0:30 - What are I Bonds? 1:27 - What is the interest rate on I Bonds? 3:26 - Are I Bonds a good investment? 5:30 - How can you buy I Savings Bonds?
My spouse and I are diversifying our long-term investment portfolio by adding various stocks and ETFs. We've allocated $220k to begin with, focusing on inflation-indexed bonds and companies with strong cash flows. I think the current market presents a good opportunity for long-term gains, but I'm also interested in learning ways to make short-term profits.
Having an adviser is the smartest approach in today's market, especially for those nearing retirement. I personally gained over $270K during this market downturn, which highlighted that there's valuable insight the average individual may not be aware of.
Do your homework and choose one that has strategies to help your portfolio grow consistently and steadily. *Camille Alicia Garcia* is responsible for the success of my portfolio, and I believe she possesses the qualifications and expertise to meet your goals.
Thanks, I just Googled her name and her website came up right away. It looks interesting so far. I'm going to book a call with her and let you know how it goes.
Everybody is concerned about the market going down but refusing to take advantage of it. The best decision ever made in my life was investing regardless of the market condition. I made over 218k.USD with a start up of 39k.USD in the last three months. Trust me guys, it really pays a lot!
My advice to anyone feeling the heat in this current market. Just trade long term more than ever. If you can then get a professional to trade for you, think that way your assets are more secure
Thanks to Fergus waylen for showing me the appropriate way to get into crypto investing and trading with his trade signal and investing guidelines. Investing and trading are more than just having TA skills. There is a big component of discipline and emotional maturity, that one has to work on! Time in the market vs. timing the market. If you keep that mentality as an investor, you will stay calm during the storm! Within some months I was making a lot more money and have continued on that same path with Mr fergus Waylen /
Yes I Agree, I've been talking to Fergus waylen for long now, mostly because I lack the knowledge and energy to deal with these ongoing market circumstances. there are more aspects of the market than the average individual is aware of. Having an investing counselor is now the best line of action, especially for most beginners and those who are close to retiring
You missed some details. It is $10,000 per person per calendar year. Plus, your rate is locked in for 6 months. Also, if you sell the bond before 5 years, you take a 3 month interest penalty. All in all, even if the rate goes to 0 next semester, it will be worth 10k, especially with stock market turning into a dumpster fire and commodities markets going wild.
I have a hard time getting excited about an investment that I have to hold for 30 years to earn 6-9% on. I hold a few bonds in my portfolio, but I hope they'll be earning more than 6-9% a year at some point in the next 20. Flexibility and good returns have always been my concern
With the extra hassles included . I can understand why there's very little reason to be excited. I personally feel like this is just another way for the FED to reach into the peoples pockets.
You need a sound investment strategy, one where you can keep your cool and capitalize on the market at the same time. I employ a licensed financial advisor Laura Jean Listak to do that for me.
I’m currently thinking about adding I-Bonds to my investments choice even if I’m already retired with a 7figure portfolio , receiving about $167k in dividends….I for one knows that investing in quality dividend paying companies is a relatively easy strategy to create generational wealth
@Gerry. Absolutely Spot on How exactly do you do it ? , what are you investing in. I could really use some help over here too. My stock picks have been depressingly bad to be honest , I’m in need of a good investment plan currently, I have a lump sum of $75,000+ in a savings account yielding next to nothing. Have you got ideas that can help me , I’m keen on advancing my portfolio a little further
Actually there’s no particular sector I focus on , I have my funds well diversified using signals from my IA , Noud Mikan. He’s a Belgian pro investor, well regulated and licensed by the FCA to trade securities…..he’s quite known on CNBC and to be honest it’s been a huge relief, good earnings and little to no engagement at all on my part.
His stocks picks are top notch , my aggressive portfolio returned almost $220k from Q4 and SCHD last year…I tell you his quite the genius in investing and portfolio diversification. Do a little research on him
@@JoeCoIIar Again and again , I come across this name Noud Mikan regarding guided lucrative investments. Can you help me get to him, I really don’t mind professional assistance
Great video!!! Now I have more knowledge about finance. In my opinion, mutual funds has to be one of the most profitable ventures out there but younger people must understand that the keyword in all of this is "diversifications" especially given the times. You shouldn't put all your eggs in one basket. I have doing drop shifting, real estate, ETFs, crypto and stock for a very long time but I made my first million (in profit) early this year from cryptocurrency alone (through the help of an IA). I also experiment with a couple of other things. Imagine what the situations would have been giving in mutual funds if I were solely banking on them. That's alot of profit too.
What kind of investment do you make? I totally agree with you. I have a lump sum that does almost nothing in a savings account. But it is difficult for me to participate in certain types of investments at the moment due to the full-time nature of my job. It will be way too stressful to combine so I don't even think about.facing it.
@@alyciagordon3447 Generally, investing requires higher knowledge. For this reason, It's important to have a solid support structure (financial consultant) to guide you through especially in asset picking. I operate with (Alexandra Diana Jose) a consultant who partners with a licensed wealth management firm. For the record, the experience has been the best for my finance. She made me financially stable investing through her help, now I earn on a monthly basis through her passive income strategy... So I'd advise you do get a good investment advisor for yourself.
@@alyciagordon3447 She is easy to find , make a quick research of her on the internet with her name Alexandra Diana Jose . She works with anyone independent of their location.
Tnx for this info, I just looked up your investment professional and found her page. Her experience is pretty impressive. I wrote her and I'm waiting on her reply.
If you're worried about not being able to withdraw for the first 12 month, consider making incremental deposits monthly or bi monthly to mitigate the risk.
Thanks for the good info. Some other points: - The limit is $10,000 per person per year. So by planning ahead you can acquire a more substantail holding. - In addition, you can buy $5000 more per year by using your IRS refund - Inflation-based bonds are a different asset class than either stocks or regular bonds. Having different asset classes is a good thing - promotes stability. - An alternative to I-bonds is TIPS (which are best held in a tax-deffreed account like and IRA - bookkeeping is much easier).
if this guy did mention 10K limit-it's not even worth to watch the vid. Last time I tried to buy I bonds thru refund via TaxCut-it failed miserably. 2 more cents
@@scsmith4604 very good point,but 10 or 20 K won't do much for a big account. On top of that they probably will recalculate those inflation numbers and next year relative to this year won't be anywhere near 7-8%. Better than nothing,compared to current markets ( stocks or bonds)
Say we keep the I bond for a couple years getting aroudn 7%.. then all of a sudden say it drops to 2% one year. Do you lose just the last 3 months of the 2% of interest? If so, that isn't bad because of all those months you got at 7%, and only lost 3 months at a very low interest rate.
@@ryanmckennan1168 Awesome. I just bought a good amount of I-Bonds :) 7.12% gauranteed for 6 months followed by 9.62% for another 6 months is just dandy :)
I just maxed out series I bonds for 2021 and 2022. Inflation will drop some in 2022, but not by the April interest rate set date. Should still be above 6% by then. I am using these as an alternative to a savings account or CD, with the cash that I plan to buy a house with in 2023.
One other thing to add: the federal taxes are waived if you use the money for “qualified educational expenses,” for you, your spouse, or your dependents in the year you cash in the bond, so it’s not a bad way to save for college expenses if you’re reticent to invest in the stock market.
@@johnm1414 yes $10k in December and $10k in January. An I bond earns interest monthly from the first day of the month in the issue date. The interest accrues (is added to the bond) until the bond reaches 30 years or you cash the bond, whichever comes first. The interest is compounded semiannually
Thanks for the video! Are the couples that file jointly can set two Primary Owner accounts under the same profile as A with B and B with A for $10K each ($20K in total)?
i got my son an I Savings bond that is taken out of my paycheck monthly. I plan to do this for at least 15 years so by the time he is in his 30s, he gets some money monthly. I estimate that he at least gets ~$800 per month for 15 years of his adult life. This will help him to become more financially established even when he is working.
@@bspiderm this is true. I understand wanting to set them up financially but I had the same idea that my son will mismanage. However I chose to do a brokerage account for my child until the age of 20 and convert over to a Roth and allow him to fund it for his retirement and explain this is truly for your future and you can't just freely take this money without penalty. Hopefully he'll be financially responsible and takes over the account and invest in himself.
That’s not the point. The point is that he will have an extra income. Maybe some parents will think that way that when their kids got extra money, that makes them lazy. I think it depends on how you train the kids when they are younger. For instance, kids cannot do what they want to do and doesn’t have the freedom to explore their passion because they don’t have enough financial support for them to support their goals. So, instead of pursuing the passion, they end up being unhappy doing a job that they don’t want. That’s why, I think a lot of people nowadays are so unhappy, because their parents never really plan for their kids future that when their kids became adults, they end up struggling, depressed, homeless and some even commit suicide - paying loans and such that they have to stay in a job that they hate. I am saving for my son because I want him to have the freedom to experience life and pursue his passion in life once he is old enough to be independent. I don’t want him to worry about paying student loans or paying debts but I want him to focus on what will make him happy. Planning for my son’s future by investing in the I Savings will not make my son become lazy. I am supporting his future so he can pursue what he would want to do - if he would want to pursue arts, or travel while in school, write books, become a musician but not a starving one - he will have the funds that will allow him to do that. Aside from I Savings, he already have his own custodian long term stock investments which he can choose to keep for the longest time that he would want to keep it. I let my son dream of what he wants to be. And I don’t just let him dream, I am creating a way that will support him to get to that dream. And I think that is when most parents fail, they let their kids dream but lean on getting loans and debts to support their kids dreams.
I’m using it as my emergency fund and not really as an investment. That way my emergency fund is always of a real set value. I just have to keep extra money that first year though since you can’t withdraw in the first year. There are a lot of predictions that inflation will remain high for 2 years and the longer you hold the less of a hit foregoing the last 3 months of interest is for withdrawing in the first 5 years. I bought the max in December and January so going to be tight for a while.
So what if the inflation drops after 1 year, you wait another year holding the bonds with lower rate, and then withdraw - which 3 months of interest will you lose? The first three where you earned higher interest or the last 3 where you earned less interest? Or some kind of average?
If you make one $10,000 purchase, can you withdrawal only part of it after one year? Or do you have to cash out the entire amount once looking to to take some out?
Hi very helpful video! Thank you! So should you wait to take it out after 6 years only if inflation is high at that time? Also can you do it in a child's name or put a beneficiary?
You need to be one of the following to purchase I Bonds: - A U.S. citizen, even if you live abroad - A U.S. resident - A civilian employee of the U.S. government, regardless of where you live
From my understanding of it, $10k per calendar year. So essentially can buy 10k In Dec 2022, then another 10k in January 2023. Also 5k, if you want to use your tax return to purchase. Hope that helps.
One thing I think the FEDS could do to boost people buying I-bonds and boost overall excitment is drop the tax rate by a lot if you hold onto your I-bonds for the full 30 year term. One thing I love about I-bonds is they take very little effort and thinking. I buy the I-bond and it just does its thing. I don't have to check up on it every month or worry if the interest rate is low for a 6month term because it is meant for long term investment and that works on the total life of the bond. Some people don't like them and that's fine it's their money spend, save, invest however you want.
Everybody keeps talking about the penalty as if it is a bad thing. Even if you only hold for one year, you will still be receiving over 5% interest after the 3 month penalty. Would you invest in a one year CD that pays 5%? Considering that current one year CDs are paying about 0.5% and even 5 year CDs are paying about 1%, this is a no-brainer for me.
@@syfodias-jedimaster because school is where you learn about girls, math, history, and all also stupid left wing trash like (am I a boy or a girl ---- please imagine.....)
Thanks for the video!!! It is very helpful. When I check the TD web, it does not specify how much I can buy ibond as a gift to someone. It only mentions I can only gift $10,000 to someone each year. Does it mean I can buy, for example $50,000 ibond to my wife as a gift this year and deliver to her $10,000 per year for the next 5 years?
If its at 7.12 now and then it drops to 3% do i get 7.12 on the 1st 6 months and then 3% for the second 6 monts? Or does it all just use the current interest rate?
3 to 5% after a year for i-bonds, alternatively... lots of banks are pushing savings accounts with 4% APY some even close to 5% APY with no restrictions on moving your money or penalties. I am not the most savvy investor, but if you put $100,000 into one of these accounts at a 4% rate, you still earn $333/mo just for keeping it in there. PNC bank for example. Would an i-bond earn more?
Based on the video, the con I think is my money will hold for a year. For example, if I buy I bond in the middle of the 1 May to 31 Oct...hypothetically I bought it today. Does my money hold for end of two cycle menaing end of April 2023 or It will be hold for exact a year ?
That's what my wife and I are planning to do! You could also bet that in May 2022 inflation will be even higher, and buy then. Or next November. Either way, buy today to hit your limit for this year!
@@Salac0 you can wait until April to see what the may rate will be. So if we find out the may rate will be less than 7 percent we can lock in 7.12 percent or if it’s higher in may, we can wait for the new rate
@@jonathanh5134I did notice a slight inaccuracy with my thinking: the inflation rate is variable anyway; it's the interest rate that's fixed to the purchase date.
@@dougm1985 All you have to do is OVERPAY your taxes by $5000 and then you have a refund available for the I-Bond. This is the ONLY way to buy more that 10k a year.
I'd like to know how the interest is compounded. Monthly? Every six months? Every year? Then, does the I-bond pay interest on the interest you've already realized in Year 1 or Year 2, etc.?
Interest is paid every month,but compounded every six months. Means on the seventh all interest will go towards your principal and start earning interest.
It's actually 3.56% for the next 6 months, then the rate will adjust according to inflation. You can calculate the new rate in mid-April when the CPI for March 2022 is published by comparing it to the September 2021 CPI. I-Bonds mature after 30 years, then you'll get all your money + interest back (if the US Treasury can still print money...).
Thanks for the good info. Couple questions: Electronic: $10,000 per Social Security number per calendar year. Paper (through tax refunds): $5,000 per Social Security number per calendar year
@@pikachugreen3444 Per SSN means that married couples have a $10,000 limit ($5,000 for each of them) and parents can purchase an additional $5,000 bond for each dependent on their return. However, I believe that it counts as a gift towards the gift exclusion and the bond from then on belongs to the child, meaning that child can redeem it at any time after turning 18 and keep all the proceeds. The advantage is the interest is tax free if the child uses all of the proceeds on tuition, so it can be a good risk free way to protect college savings from inflation
That's projected. He's saying if you take it out before 5 years (taking the 3 month hit) and also based on having to pay taxes on earnings when you take it out.
If I use my federal income tax refund money to buy paper I bonds, can I give that piece of paper to a child or grandchild for them to cash in in 20 years, or is that bond locked to me personally?
I have always been fascinated by investing, but without adequate knowledge on the right thing to do, I find it difficult to start. *I politely ask, what’s the best sector to invest in?*
It is entirely possible for a smart and patient investor to go into investing with the right information. One of the best ways to get started is to get help from an experienced Financial Consultant . I've been investing since *2015* and I'm extremely happy with the returns I get working with my investment advisor; *Hamilton Phoebe Zoe*
@@paolokoch1123 I am very interested in this information and I've some money sitting idly in the bank with that I can start investing without further delaying, If you don't mind How can I get in touch with your professional?
@@mooersproducts350 As to get more details about my Investment Professional; *Hamilton Phoebe Zoe* easily do quick internet research where you can easily write her from, do your research with her full names mentioned.
Yes, that is correct. The new rate as of May 2022 is 9.62%. Check out our new I Bonds video here - ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE--ocdKJfPfI0.html
Warning! If you ever have to contact Treasury Direct they will not contact you by email and the hold time is usually 2-6 hours! We have been locked out of our account for months!
You can buy anytime and as often as you want. The lowest increment allowed is $25 and the most you can invest is $10,000 per year. There is an option to buy an additional $5,000 a year through your tax refund.
Justin for peopple like me on Fixed Income (retired), Please tell me alternatives to State Tax free returns of 7.12% safe (US Treasury up to now should be Safe), that are geard to Inflation increases? I intend to put $10K for each of us (the wife), on May 2, 2022. The Calculated rate is now going to be 9.65% based on the newest CPI-U Inflation Numbers just released. And watch out for Stock market- it is going to be a Bumpy ride.
@@Chiroman527 Aldo, if i understand correctly you should buy right now! Before May 2 and get the 7.12% for 6 months and then at the end of October start the next 6 months at 9.65%. Then you have 1 full year of ~8% average under your belt. Better this than take the chance that the next november goes substantially down and you only got 6 mo at 9.65%. And after that its all gravy but you can still withdraw if you want and still be better off even with a 3 mo penalty.
meh!, It's not too late. Buy now, you get Interest from May 1 @9.62% and then on Nov 1, even if Inflation goes down a Bit (? do you really think so) you will earn the rate of 8.0% (more or less) for the next 6 months. It will take an extraordinary effort to put a Stop on Inflation by this current idiotic administration.
Thanks. Great material. Question. How long should one hold on to I bond to avoid reduction in return? This is Oct 2022 - inflation to come down swiftly in next 2 years I believe. So holding for years will deprive me the gain eventually. Thanks again
Interest rates are always stated in terms of years. If you expect 7% a week out of anything, you might be looking at investing in a smuggler and hoping they don't get robbed or something. Keep in mind that this is guaranteed, unlike the stock market, which over the long term almost always has strong gains but in the short term can be utterly brutal.
I wants to buy I bonds for my daughter, she is not a child, she is an adult. I wants to know I bonds will be good to buy for to study? Please your a comment.
How can I add an BENEFICIARY to my purchased I Bonds on Treasury Direct? I currently have I bonds in mine and my wife’s name as primary and co-owner. Do you just click on the BENEFICIARY circle and put in my name as Primary and say my son as a Beneficiary? Thanks for your expertise!
Hard ain't it. I just added my girlfriends as Beneficiary. You are correct. I got an email saying changes were made but has not showed up on the page yet. 8 years ago I digitized EE and I bonds. Took them 6 plus months to do it. Bank, Annuity, Investment companies have to search for Beneficiaries. I'm sure treasury direct will not. So let your son know about the account and he might need a lawyer or good accountant to forward assets. (It is that hard) Just for the record. When done he will get his own digital account. They won't cut a check direct to him. Never ever list Treasure Direct as an asset when applying for any program. a 5 year lookback they only will find it from your checking account if you have been adding to the Treasury Direct in the last 5 years and they might want that money back. The rest is a black hole they will never find. 8 years ago they would answer questions via e mail. In the last 6 month emails tell you to call them on a phone never answered.
Here is how it works: you lose 25% of your interest if you cash in the first year, 3/12, year 2 its 12.5%, and incrementally less until year 5. You will still receive in excess of 5% if you hold for only one year. Would you invest in a one year CD that was paying 5%? I certainly would.
You made a mistake when you said you can only buy 10,000.00. That is 10,0000.00 PER YEAR. You can buy 10,000.00 per person each year for as long as you want.
Hi! I got iBond in April. Recently (early this August) my account got locked, and I got an email to call them. I call the number they provided and the wait time is 3 hours... I looked on yelp and see a lot of bad feedback regarding their customer service since 2015. My account is still lock and I can't wait for that long, I am working and need my phone and they are only open on weekdays until 4 or 5pm. I emailed them already and no response until now. Do you have any suggestion on how I can solve my problem, unlocking my account? With this experience I am regretting on investing with them.
I needed to start buying this as unfortunately I only started saving for retirement this year. I had a good emergency fund that I was going to split into retirement savings but had an unexpected large expense that dropped that to nothing. I think this bond purchase and future purchases will help me actually accumulate savings. I would definitely not like to work at 68 as SSA says I need to.
A strategy I will use is to but the bonds for the next 10 years and make my withdrawals last the next 15 years in retirement. That 10,000 bond may be near 20000 when I start withdrawing
@@jj7958 Ive since learned that it’s a variable rate of return. However, I cannot find any historical data on what the variation may look like over the years. Would you happen to know where to find that information?
just threw the 10k limit at it today. gonna let it it do it’s thing as long as inflation is high. Probably will let it sit there for a while maybe use it for a home down payment in the future
@@cooldeesir Overpay your taxes for the next calendar year. Then you will get a refund the next tax year to be able to use those funds. If you owe, you have no refund then you have no additional funds to purchase.
Starting early is the best way of getting ahead to build wealth, investing remains a priority. The stock market/crypto market has plenty of opportunities to earn a decent payout even in a downtrend, with the right skills and proper understanding of how the market works.
Mrs. PRISCILLA DIANE AIVAZIAN really knows her way around trading, it's evident from her deep knowledge of how the market works, and reading signals to perfection, I feel very safe trading with her.
@@danieljamal3709 at the end of the day she is still gambling with your money… no safe investment strategy would have tripled your money in a year meaning she took on massive risk..
I normally give presents to the kids in my life each holiday. I was thinking of switching to I bonds for at least part of it (say $50-$100 per birthday/Christmas) to help them pay for college or to start a business someday but not having paper bonds makes this a pain in the butt. Their parents must set up a minor account for them, and I have to have their SSN (!!) to transfer it to them. That’s crazy to me. :(
Do you only reap the interest rate at the time of your point of sale of your bonds? Or are ibonds accumulating/compounding interest over time like a CD? If I bought a $10k 7% bond and then sold at year 6 and in year 6 bond rates are now only 1%, do I only walk with $10k + 1%?
My understanding is that Series I bonds compound monthly with semiannual rate changes. So even if the variable rate changes twice a year (currently 7.12%), but you hold for 6 years and the rate ultimately drops to 1%, you're still compounding that new 1% rate on the accrued interest you made in the previous 6 years PLUS your $10k principal.
You can cash your Series I bonds any time after 12 months. You receive the original purchase price plus interest earnings. I bonds are meant to be longer-term investments; if you redeem an I bond within the first 5 years, you'll lose your last 3 months interest. For example, if you redeem an I bond after 18 months, you'll receive the first 15 months of interest.
Currently the fixed rate is 0%. The Fed is expected to raise the interest rate next year. Let's say this happens before May 1, 2022. Doesn't that mean that the fixed rate (which also contributes to the calculation of I Bond interest rate) will be more than 0% on May 1, 2022 for the purposes of calculating the I Bonds interest rate?
When you buy it, your bond is locked in with a base rate at that time, currently it's 0. Your overall rate is just inflation hedge, no premium otherwise. If they raise rates, then your next purchase after the next reset would have a different base rate plus the semi annual inflation rate
Holly, good question. The Treasury department decides the fixed rate. There's no criteria used or magical formula. It's whatever the Treasury department says it is. I, and many other people, do think the Treasury Department used the current TIPS fixed rate as a guideline. The current TIPS fixed rate is still negative, so I think we'll need to see some movement before May in order for the new IBonds fixed rate to be above zero. That said, rates have been moving upwards rather quickly, so there's a chance. Also, the fixed rate at purchase is for the life of the bond.
You won’t see the interest on your account until month 5, due to the 3 month early withdrawal penalty being built in. (Edited response for clarity, more in follow up comment)
@@AlejandroLopez-wd3on It is due to the 3 month early withdrawal penalty being built in. If your bonds are still within five years from the Issue Date, the Current Value automatically excludes interest earned in the last three months so that if you cash out today, you’ll receive the Current Value. That’s why you won’t see any interest in the current value during the first four months. You will start seeing a higher value in the fifth month. My timing was a little off on my original response. After 5 years from the issue date, the current value will reflect all interest up through the prior month.
