I Bonds Mega Thread (I Bond Heads Rejoice!)

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acegolfer
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by acegolfer »

tipswatcher wrote: Mon Sep 19, 2022 7:11 am I am not quoting a 10-year nominal yield. The 10-year TIPS real yield is currently 1.07%, based on Treasury's daily estimate: https://home.treasury.gov/resource-cent ... nth=202209

This is the TIPS real yield, the yield above inflation. (The nominal 10-year is now at 3.45%).
TY. Is this nominal or real yield: https://www.cnbc.com/quotes/US10YTIP

Curious. If the nominal yield is 3.45% and the real yield is 1.07%, what's the inflation rate? Isn't it about 8% yoy?
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HueyLD
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by HueyLD »

Interesting. Fidelity site for the upcoming 10-year TIPS auction shows an estimated YTW of 1.137% based on a third party price of 95.833.

However, Fidelity’s quoted all-in price is too high at 102.09204 even though the inflation adjusted price appears to be 97.722826.
(=95.833 x 1.01972). The 2 1/2 month of accrued interest could not account for such a difference.

I wonder if the price discrepancy is due to stale prices because the market is not open yet.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by tipswatcher »

acegolfer wrote: Mon Sep 19, 2022 7:20 am
tipswatcher wrote: Mon Sep 19, 2022 7:11 am I am not quoting a 10-year nominal yield. The 10-year TIPS real yield is currently 1.07%, based on Treasury's daily estimate: https://home.treasury.gov/resource-cent ... nth=202209

This is the TIPS real yield, the yield above inflation. (The nominal 10-year is now at 3.45%).
TY. Is this nominal or real yield: https://www.cnbc.com/quotes/US10YTIP

Curious. If the nominal yield is 3.45% and the real yield is 1.07%, what's the inflation rate? Isn't it about 8% yoy?
The TIPS real yield is based on future inflation, not past inflation. So, 1.07% above future inflation.
TIPS: Perfect investment for imperfect times?
acegolfer
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by acegolfer »

tipswatcher wrote: Mon Sep 19, 2022 7:31 am The TIPS real yield is based on future inflation, not past inflation. So, 1.07% above future inflation.
That's what I suspected. Can we say that the market expects the future 10-yr inflation annualized rate is about 2.38% from these 2 yields?
ikowik
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by ikowik »

HueyLD wrote: Mon Sep 19, 2022 7:29 am Interesting. Fidelity site for the upcoming 10-year TIPS auction shows an estimated YTW of 1.137% based on a third party price of 95.833.

However, Fidelity’s quoted all-in price is too high at 102.09204 even though the inflation adjusted price appears to be 97.722826.
(=95.833 x 1.01972). The 2 1/2 month of accrued interest could not account for such a difference.

I wonder if the price discrepancy is due to stale prices because the market is not open yet.
I checked this morning on this CUSIP. Ask price on secondary market for minimum of 10 (x$1000) was $97.727 at Fidelity
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HueyLD
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by HueyLD »

ikowik wrote: Mon Sep 19, 2022 9:18 am
HueyLD wrote: Mon Sep 19, 2022 7:29 am Interesting. Fidelity site for the upcoming 10-year TIPS auction shows an estimated YTW of 1.137% based on a third party price of 95.833.

However, Fidelity’s quoted all-in price is too high at 102.09204 even though the inflation adjusted price appears to be 97.722826.
(=95.833 x 1.01972). The 2 1/2 month of accrued interest could not account for such a difference.

I wonder if the price discrepancy is due to stale prices because the market is not open yet.
I checked this morning on this CUSIP. Ask price on secondary market for minimum of 10 (x$1000) was $97.727 at Fidelity
I talked to a fixed income trading desk employee this morning and it turned out to be Fido’s system glitch. They promised to fix the glitch ASAP.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by MisterMister »

acegolfer wrote: Mon Sep 19, 2022 7:54 am
tipswatcher wrote: Mon Sep 19, 2022 7:31 am The TIPS real yield is based on future inflation, not past inflation. So, 1.07% above future inflation.
That's what I suspected. Can we say that the market expects the future 10-yr inflation annualized rate is about 2.38% from these 2 yields?
What you are referring to is the BEI (break-even inflation rate). TIPS, BEI and the like are discussed in great detail here:
viewtopic.php?t=378350

Also see:
https://fred.stlouisfed.org/series/T10YIE
acegolfer
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by acegolfer »

MisterMister wrote: Mon Sep 19, 2022 10:48 am
acegolfer wrote: Mon Sep 19, 2022 7:54 am
tipswatcher wrote: Mon Sep 19, 2022 7:31 am The TIPS real yield is based on future inflation, not past inflation. So, 1.07% above future inflation.
That's what I suspected. Can we say that the market expects the future 10-yr inflation annualized rate is about 2.38% from these 2 yields?
What you are referring to is the BEI (break-even inflation rate). TIPS, BEI and the like are discussed in great detail here:
viewtopic.php?t=378350

Also see:
https://fred.stlouisfed.org/series/T10YIE
TY. Bookmarked the stl Fed. My understanding was correct. 2.38% is " what market participants expect inflation to be in the next 10 years, on average."
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Angst »

Does anyone here maintain a list of their I Bonds (and EE Bonds) using "Outside investments" at Vanguard? It won't value them for you but in the past I've found it a nice way to view the portfolio. Nice, but only until the new website design was rolled out. If anyone knows something about dealing with it's new shortcomings that I don't, please let me know. Btw, yes I know all about TD's software and #Cruncher's website.

This link is to a "how-to" post I made in the Vanguard "Fisher-Price" thread:
viewtopic.php?p=6879593#p6879593
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Mel Lindauer »

Angst wrote: Tue Sep 20, 2022 2:09 pm Does anyone here maintain a list of their I Bonds (and EE Bonds) using "Outside investments" at Vanguard? It won't value them for you but in the past I've found it a nice way to view the portfolio. Nice, but only until the new website design was rolled out. If anyone knows something about dealing with it's new shortcomings that I don't, please let me know. Btw, yes I know all about TD's software and #Cruncher's website.

This link is to a "how-to" post I made in the Vanguard "Fisher-Price" thread:
viewtopic.php?p=6879593#p6879593
Yes, I include the total value of my I Bonds in the "Outside Investments" section at Vanguard. That allows me to have all of my investments listed in one place (I also have my bank accounts listed there). I update it manually on a monthly basis.
Best Regards - Mel | | Semper Fi
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Nver2Late »

Mel Lindauer wrote: Tue Sep 20, 2022 3:56 pm
Angst wrote: Tue Sep 20, 2022 2:09 pm Does anyone here maintain a list of their I Bonds (and EE Bonds) using "Outside investments" at Vanguard? It won't value them for you but in the past I've found it a nice way to view the portfolio. Nice, but only until the new website design was rolled out. If anyone knows something about dealing with it's new shortcomings that I don't, please let me know. Btw, yes I know all about TD's software and #Cruncher's website.

This link is to a "how-to" post I made in the Vanguard "Fisher-Price" thread:
viewtopic.php?p=6879593#p6879593
Yes, I include the total value of my I Bonds in the "Outside Investments" section at Vanguard. That allows me to have all of my investments listed in one place (I also have my bank accounts listed there). I update it manually on a monthly basis.
I do too but not a list of each bond. I just have a total that I update each month.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Mel Lindauer »

Nver2Late wrote: Tue Sep 20, 2022 4:01 pm
Mel Lindauer wrote: Tue Sep 20, 2022 3:56 pm
Angst wrote: Tue Sep 20, 2022 2:09 pm Does anyone here maintain a list of their I Bonds (and EE Bonds) using "Outside investments" at Vanguard? It won't value them for you but in the past I've found it a nice way to view the portfolio. Nice, but only until the new website design was rolled out. If anyone knows something about dealing with it's new shortcomings that I don't, please let me know. Btw, yes I know all about TD's software and #Cruncher's website.

This link is to a "how-to" post I made in the Vanguard "Fisher-Price" thread:
viewtopic.php?p=6879593#p6879593
Yes, I include the total value of my I Bonds in the "Outside Investments" section at Vanguard. That allows me to have all of my investments listed in one place (I also have my bank accounts listed there). I update it manually on a monthly basis.
I do too but not a list of each bond. I just have a total that I update each month.
In case I wasn't clear, that's what I do too (just the total value of ALL the I Bonds that I own).
Best Regards - Mel | | Semper Fi
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Angst »

Mel Lindauer wrote: Tue Sep 20, 2022 4:02 pm
Nver2Late wrote: Tue Sep 20, 2022 4:01 pm
Mel Lindauer wrote: Tue Sep 20, 2022 3:56 pm
Angst wrote: Tue Sep 20, 2022 2:09 pm Does anyone here maintain a list of their I Bonds (and EE Bonds) using "Outside investments" at Vanguard? It won't value them for you but in the past I've found it a nice way to view the portfolio. Nice, but only until the new website design was rolled out. If anyone knows something about dealing with it's new shortcomings that I don't, please let me know. Btw, yes I know all about TD's software and #Cruncher's website.

This link is to a "how-to" post I made in the Vanguard "Fisher-Price" thread:
viewtopic.php?p=6879593#p6879593
Yes, I include the total value of my I Bonds in the "Outside Investments" section at Vanguard. That allows me to have all of my investments listed in one place (I also have my bank accounts listed there). I update it manually on a monthly basis.
I do too but not a list of each bond. I just have a total that I update each month.
In case I wasn't clear, that's what I do too (just the total value of ALL the I Bonds that I own).
Ah, I see. I don't have a huge number of them and have them each entered separately, but the new Vanguard website has ended the nice, alpha-numeric sorting by description for them that was always there. Now they display in an entirely random, mixed up order. Quite a useless mess, so I too probably should just condense them all into a total, single line entry. I liked the display... oh well, one less thing to fool with now.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by krafty81 »

Can I bonds be added to my Schwab portfolio as an outside investment? I have had no luck adding my MYGAs.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by joe8d »

Mel Lindauer wrote: Tue Sep 20, 2022 3:56 pm
Angst wrote: Tue Sep 20, 2022 2:09 pm Does anyone here maintain a list of their I Bonds (and EE Bonds) using "Outside investments" at Vanguard? It won't value them for you but in the past I've found it a nice way to view the portfolio. Nice, but only until the new website design was rolled out. If anyone knows something about dealing with it's new shortcomings that I don't, please let me know. Btw, yes I know all about TD's software and #Cruncher's website.

This link is to a "how-to" post I made in the Vanguard "Fisher-Price" thread:
viewtopic.php?p=6879593#p6879593
Yes, I include the total value of my I Bonds in the "Outside Investments" section at Vanguard. That allows me to have all of my investments listed in one place (I also have my bank accounts listed there). I update it manually on a monthly basis.
Do exactly the same Mel.
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Redeeming a fraction of an i-bond

Post by MattB »

[Thread merged into here --admin LadyGeek]

How does one redeem a fraction of an i-bond?

I'm trying to familiarized myself with TreasuryDirect. I'm sitting on the ManageDirect --> Redemption --> Summary page. And there doesn't appear to be an option to redeem a fraction of an i-bond. The only thing I appear to be able to do is select a security and click "submit."

Will this redeem the whole bond? Or is there a page beyond "submit" where I can choose date and amount?

Thank you.
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Re: Redeeming a fraction of an i-bond

Post by Parkinglotracer »

You can’t redeem a portion of an ibond.

Edited - I was wrong.
Last edited by Parkinglotracer on Wed Sep 21, 2022 5:26 pm, edited 1 time in total.
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Re: Redeeming a fraction of an i-bond

Post by exodusNH »

Parkinglotracer wrote: Wed Sep 21, 2022 5:16 pm You can’t redeem a portion of an ibond.
You can do partial redemptions. I don't know the mechanics of doing so, but you can redeem as little as $25. The redemption is prorated principal and interest.
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Re: Redeeming a fraction of an i-bond

Post by MattB »

exodusNH wrote: Wed Sep 21, 2022 5:18 pm
Parkinglotracer wrote: Wed Sep 21, 2022 5:16 pm You can’t redeem a portion of an ibond.
You can do partial redemptions. I don't know the mechanics of doing so, but you can redeem as little as $25. The redemption is prorated principal and interest.
That was my belief. But I'm not sure how to go about it. Would appreciate guidance from someone familiar with TD.
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Re: Redeeming a fraction of an i-bond

Post by whodidntante »

This page answers your question. $25 or more. https://www.treasurydirect.gov/indiv/re ... m.htm#time
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Re: Redeeming a fraction of an i-bond

Post by SockMonkey »

Does this help? Guided Tour: Redeem Securities

https://www.treasurydirect.gov/indiv/tdtour/redeem.htm
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Re: Redeeming a fraction of an i-bond

Post by MattB »

SockMonkey wrote: Wed Sep 21, 2022 5:33 pm Does this help? Guided Tour: Redeem Securities

https://www.treasurydirect.gov/indiv/tdtour/redeem.htm
Perfect. Thank you.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by LadyGeek »

I merged MattB's thread into the ongoing discussion.

(Thanks to the member who reported the post and provided a link to this thread.)
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by delrinson »

I understand the $10,000 annual limit. But what would actually happen if, after my having bought a $10,000 bond, someone transferred me a $10,000 gift from her gift box in the same year? Would TD actually send it back to the gift box?
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Merry »

Thanks for the replies on understanding the ibond gift rules recently. Spouse and I bought $10k gifts for each other a couple weeks ago and understand how the interest adjustments and buy/gift rules work.

Now we are thinking we’d buy another $10k each this month, which we’d plan to give to each other Jan 2024. If so, is the following correct:
-Will receive current 9.62% through Feb 2023. Mar 1-Aug 31, 2023 rate will be what is set Nov 1, 2022 (which many of you are thinking will be about 6%). Sept 1, 2023- Feb 2024 rate will be what is set May 2023 which is Unknown.

I’m trying to weigh the pros and cons of buying the second $10k each gifts. Is the main con that the rate set May 2023 could be very low, in which case we’d be stuck with them from Sept 1, 2023 until they are gifted Jan 2024? If so and we decide to cash in right after we get our gifts, at least the last 3 months of interest that would be forfeited as penalty would be low. So overall is it fair to say the risk is low to buy another $10k each now? My other option for these funds (very safe money) would be to buy treasury bills.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by whodidntante »

delrinson wrote: Wed Sep 21, 2022 10:14 pm I understand the $10,000 annual limit. But what would actually happen if, after my having bought a $10,000 bond, someone transferred me a $10,000 gift from her gift box in the same year? Would TD actually send it back to the gift box?
I wouldn't knowingly do that. As far as what TD will do, you might get lucky and hear 1 or 2 data points, but the bigger concern is what they are empowered to do. Who knows? Maybe they decide to close your account.
MattB
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by MattB »

LadyGeek wrote: Wed Sep 21, 2022 5:49 pm I merged MattB's thread into the ongoing discussion.

(Thanks to the member who reported the post and provided a link to this thread.)
Thank you. I did not realize that all i-bond questions went here.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by evelynmanley »

MattB wrote: Wed Sep 21, 2022 11:58 pm
LadyGeek wrote: Wed Sep 21, 2022 5:49 pm I merged MattB's thread into the ongoing discussion.

(Thanks to the member who reported the post and provided a link to this thread.)
Thank you. I did not realize that all i-bond questions went here.
Harry Sit's website is a great resource for learning all about I-Bonds:

https://thefinancebuff.com/how-to-buy-i-bonds.html

Gifting: https://thefinancebuff.com/buy-i-bonds-as-gift.html

Harry Sit's archives of all his articles about I-Bonds: https://thefinancebuff.com/tag/i-bonds
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by MikeG62 »

Merry wrote: Wed Sep 21, 2022 10:19 pm Thanks for the replies on understanding the ibond gift rules recently. Spouse and I bought $10k gifts for each other a couple weeks ago and understand how the interest adjustments and buy/gift rules work.

Now we are thinking we’d buy another $10k each this month, which we’d plan to give to each other Jan 2024. If so, is the following correct:
-Will receive current 9.62% through Feb 2023. Mar 1-Aug 31, 2023 rate will be what is set Nov 1, 2022 (which many of you are thinking will be about 6%). Sept 1, 2023- Feb 2024 rate will be what is set May 2023 which is Unknown.

I’m trying to weigh the pros and cons of buying the second $10k each gifts. Is the main con that the rate set May 2023 could be very low, in which case we’d be stuck with them from Sept 1, 2023 until they are gifted Jan 2024? If so and we decide to cash in right after we get our gifts, at least the last 3 months of interest that would be forfeited as penalty would be low. So overall is it fair to say the risk is low to buy another $10k each now? My other option for these funds (very safe money) would be to buy treasury bills.
I think you have this right. Seems very little risk that a 2024 gift purchase would yield less than buying a similar term Treasury instead.

Full disclosure, my wife and I have both purchased gifts for each other for 2023 and 2024. We did this in April of 2022. I'm thinking through whether to go out one more year (buying gift bonds for each other for 2025 delivery). This one not quite as compelling as the 2024 gifts, but probably still better than the alternative (which would be a Treasury maturing in ~2 years). I've modeled it out using various assumptions around CPI-U going out in time and the resultant variable rate component of I Bonds. Think the yield would be in the mid to upper 4% area even assuming the Fed gets inflation under control relatively quickly. Not sure it is worth the bother when the alternative is a two-year Treasury today pushing 4.10%. Yes, yield is likely to be higher, but perhaps not by enough to tie up the funds for 27 months. YMMV.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by MattB »

MikeG62 wrote: Thu Sep 22, 2022 5:50 am
Merry wrote: Wed Sep 21, 2022 10:19 pm Thanks for the replies on understanding the ibond gift rules recently. Spouse and I bought $10k gifts for each other a couple weeks ago and understand how the interest adjustments and buy/gift rules work.

Now we are thinking we’d buy another $10k each this month, which we’d plan to give to each other Jan 2024. If so, is the following correct:
-Will receive current 9.62% through Feb 2023. Mar 1-Aug 31, 2023 rate will be what is set Nov 1, 2022 (which many of you are thinking will be about 6%). Sept 1, 2023- Feb 2024 rate will be what is set May 2023 which is Unknown.

I’m trying to weigh the pros and cons of buying the second $10k each gifts. Is the main con that the rate set May 2023 could be very low, in which case we’d be stuck with them from Sept 1, 2023 until they are gifted Jan 2024? If so and we decide to cash in right after we get our gifts, at least the last 3 months of interest that would be forfeited as penalty would be low. So overall is it fair to say the risk is low to buy another $10k each now? My other option for these funds (very safe money) would be to buy treasury bills.
I think you have this right. ...
I'll add one small point.

If you are going to purchase i-bonds for each other now (Sept. or Oct. 2022), and then again in January 2023, I suggest that you purchase both sets as gifts, deliver the set purchased now in 2023, and deliver the set purchased in 2023 in 2024. This will give you access to the first set of gifts later next year, in 2023. Saving gifts purchased now for delivery in 2024, and purchasing another set in 2023, will leave both sets locked up until 2024.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Lextalionis »

krafty81 wrote: Tue Sep 20, 2022 7:23 pm Can I bonds be added to my Schwab portfolio as an outside investment? I have had no luck adding my MYGAs.
If you are talking about the Schwab aggregator, I use the real estate function to include the ibond value and adjust it annually.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by sandan »

Anyone have insights into predicting the fixed rate for November?

A few years ago I saw a pretty good prediction model using the 5 & 10 year TIPs. I wish I still had the link to the site. If my memory is correct and the treasury is still honest, I'm guessing it should be around 1.2-1.6%.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by nps »

sandan wrote: Sat Sep 24, 2022 4:04 pm Anyone have insights into predicting the fixed rate for November?

A few years ago I saw a pretty good prediction model using the 5 & 10 year TIPs. I wish I still had the link to the site. If my memory is correct and the treasury is still honest, I'm guessing it should be around 1.2-1.6%.
That would surprise a lot of folks here.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by evelynmanley »

sandan wrote: Sat Sep 24, 2022 4:04 pm Anyone have insights into predicting the fixed rate for November?

A few years ago I saw a pretty good prediction model using the 5 & 10 year TIPs. I wish I still had the link to the site. If my memory is correct and the treasury is still honest, I'm guessing it should be around 1.2-1.6%.
Ken Tumin addresses this question:

Fed Meeting: Third Straight 75-bp Rate Hike - Strategies for Savers
WEDNESDAY, SEPTEMBER 21, 2022 BY Ken Tumin

https://www.depositaccounts.com/blog/fe ... rate-hike/

<<High inflation from September 2021 through March 2022 has resulted in a record-high I Bond inflation rate of 9.62%. Unfortunately, the I Bond fixed rate remains at 0%, so the composite rate equals the inflation rate. I Bonds that are purchased through October 2022 will earn an annualized yield of 9.62% for six months. The rate for the next six months will depend on inflation from March through September 2022. On October 13th, we’ll be able to calculate the next I Bond inflation rate. Based on inflation from March through August, the November I Bond rate will likely be at least 6%.

There’s a chance that the I Bond fixed rate that will be announced in November will be positive for the first time since 2019. So you may want to wait until November to purchase I Bonds for 2022.>>
Xrayman69
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I Bonds gifting between spouses, How?

Post by Xrayman69 »

[Thread merged into here --admin LadyGeek]

How do you go about gifting I bonds to a spouse who has maxed out on annual individual limit of 10K?

Does this preclude future purchases? And if I started process how long does it take to clear and therefore should I leave a few days before end of month to make sure it goes through?
Tdubs
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Re: I Bonds gifting between spouses, How?

Post by Tdubs »

There is a good how-to series by the Finance Buff on gifting, delivering a gift, establishing a living trust and other topics. The link for gifting is:

https://thefinancebuff.com/buy-i-bonds-as-gift.html
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by LadyGeek »

I merged Xrayman69's thread into the ongoing discussion.

(Thanks to the member who reported the post and provided a link to this thread.)
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MisterMister
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Re: I Bonds gifting between spouses, How?

Post by MisterMister »

Xrayman69 wrote: Sat Sep 24, 2022 6:38 pm [Thread merged into here --admin LadyGeek]

How do you go about gifting I bonds to a spouse who has maxed out on annual individual limit of 10K?

Does this preclude future purchases? And if I started process how long does it take to clear and therefore should I leave a few days before end of month to make sure it goes through?
You cannot deliver a gift under those circumstances, but you can buy the gift any time regardless of whether the recipient has already bought 10K for the year. Personally I'd allow a week before end-of-month, but most people will say 2-3 days is sufficient. You will receive a full month interest for the month of purchase no matter when you buy in the month, but I don't find that a compelling reason to wait until the last minute (assuming funds are available).

You can buy multiple years of gifts, but each recipient can take ownership of a maximum of 10K per year regardless of whether bonds are purchased or are gifts. You can also buy I-Bonds with tax refund money (and thereby exceed the 10K limit) but I omit that conversation for simplicity.

The gifting process itself is quite well explained here: https://www.youtube.com/watch?v=9hfHoSijJEk.
Doc7
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Doc7 »

I just assisted another coworker with TD.gov signup and purchase of $10K I-Bonds.

Having now gone through it for me, my wife, and 2 coworkers, with 0% Medallion Guarantee requirements, I really, really, wonder about the lack of success out there. I wonder if it is because they see that Driver License is optional, and therefore skip it, thus ending up on the second identity verification process?
SnowBog
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by SnowBog »

Doc7 wrote: Tue Sep 27, 2022 7:45 am I just assisted another coworker with TD.gov signup and purchase of $10K I-Bonds.

Having now gone through it for me, my wife, and 2 coworkers, with 0% Medallion Guarantee requirements, I really, really, wonder about the lack of success out there. I wonder if it is because they see that Driver License is optional, and therefore skip it, thus ending up on the second identity verification process?
+1

I think some of it is those who have had issues are far more likely to post about it, then my guess the much larger number of people who've had no issues but rarely post saying "worked fine for me" (or do so like yourself when they've seen it work fine multiple times first) ...

Some of it (very few admit this) includes people make data entry mistakes.

I assume a larger part is related to people with credit issues (including those with credit freezes - which they forget to remove prior) that interfere with the online verification process.

The flip side to all of this is that the verification process helps protect your account. If someone attempts to gain access to my TD account and link a new bank account to steal my money, they'll be stopped cold in their tracks. There was a recent post (maybe two) about issues with people's brokerage accounts, where the criminals were able to get lots of money pulled out before they were stopped (and the money recovered). Both involved linking new accounts to receive the funds. Had a similar process been in place - none of the money would have ever been touched. In fact, I wish I could "opt in" to a similar signature guarantee at my brokerage!
Eric76
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Eric76 »

evelynmanley wrote: Sat Sep 24, 2022 5:01 pm
sandan wrote: Sat Sep 24, 2022 4:04 pm Anyone have insights into predicting the fixed rate for November?

A few years ago I saw a pretty good prediction model using the 5 & 10 year TIPs. I wish I still had the link to the site. If my memory is correct and the treasury is still honest, I'm guessing it should be around 1.2-1.6%.
Ken Tumin addresses this question:

Fed Meeting: Third Straight 75-bp Rate Hike - Strategies for Savers
WEDNESDAY, SEPTEMBER 21, 2022 BY Ken Tumin

https://www.depositaccounts.com/blog/fe ... rate-hike/

<<High inflation from September 2021 through March 2022 has resulted in a record-high I Bond inflation rate of 9.62%. Unfortunately, the I Bond fixed rate remains at 0%, so the composite rate equals the inflation rate. I Bonds that are purchased through October 2022 will earn an annualized yield of 9.62% for six months. The rate for the next six months will depend on inflation from March through September 2022. On October 13th, we’ll be able to calculate the next I Bond inflation rate. Based on inflation from March through August, the November I Bond rate will likely be at least 6%.

There’s a chance that the I Bond fixed rate that will be announced in November will be positive for the first time since 2019. So you may want to wait until November to purchase I Bonds for 2022.>>
https://fred.stlouisfed.org/series/DFII10

10 year high FWIW
stuyguy
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by stuyguy »

Doc7 wrote: Tue Sep 27, 2022 7:45 am I just assisted another coworker with TD.gov signup and purchase of $10K I-Bonds.

Having now gone through it for me, my wife, and 2 coworkers, with 0% Medallion Guarantee requirements, I really, really, wonder about the lack of success out there. I wonder if it is because they see that Driver License is optional, and therefore skip it, thus ending up on the second identity verification process?
My homebound BIL's driver's license expired over a year ago and he is unable to get a State ID card. His small-town bank pays meager CD rates, and I was unable to establish an account for him anywhere because he lacked a valid ID. In applying at TD, I skipped the DL info and yet he was approved. He also has no credit history. Just my 2 cents
Tom_T
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Tom_T »

evelynmanley wrote: Sat Sep 24, 2022 5:01 pm There’s a chance that the I Bond fixed rate that will be announced in November will be positive for the first time since 2019. So you may want to wait until November to purchase I Bonds for 2022.
Why do you say that? The variable rate is likely to be lower. Why would they increase the fixed rate if they didn't do so at 9.62%?
alluringreality
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by alluringreality »

Tom_T wrote: Tue Sep 27, 2022 4:38 pm
evelynmanley wrote: Sat Sep 24, 2022 5:01 pm There’s a chance that the I Bond fixed rate that will be announced in November will be positive for the first time since 2019. So you may want to wait until November to purchase I Bonds for 2022.
Why do you say that? The variable rate is likely to be lower. Why would they increase the fixed rate if they didn't do so at 9.62%?
The comment may be based around historical fixed rates. The real yield curve has increased considerably since the last rates were set. Previously positive fixed rates were offered when TIPS rates were lower than the current real yield curve. It looks like the largest fixed rate increase was 0.7% in 2008, and the average increase from 0% has been considerably less. The best historical increase means someone probably needs an expected holding period of 7 years or more to consider passing on the current offer of $1.20 for each $25 invested over the current first 6 months, so it's debatable if waiting to see if a higher fixed rate is offered makes sense for a majority of buyers.
https://fred.stlouisfed.org/series/DFII5
30% Savings Bonds, 45% US Indexes, 25% Ex-US Indexes - Buy & Hold
SnowBog
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by SnowBog »

alluringreality wrote: Tue Sep 27, 2022 5:14 pm
Tom_T wrote: Tue Sep 27, 2022 4:38 pm
evelynmanley wrote: Sat Sep 24, 2022 5:01 pm There’s a chance that the I Bond fixed rate that will be announced in November will be positive for the first time since 2019. So you may want to wait until November to purchase I Bonds for 2022.
Why do you say that? The variable rate is likely to be lower. Why would they increase the fixed rate if they didn't do so at 9.62%?
The comment may be based around historical fixed rates. The real yield curve has increased considerably since the last rates were set. Previously positive fixed rates were offered when TIPS rates were lower than the current real yield curve. It looks like the largest fixed rate increase was 0.7% in 2008, and the average increase from 0% has been considerably less. The best historical increase means someone probably needs an expected holding period of 7 years or more to consider passing on the current offer of $1.20 for each $25 invested over the current first 6 months, so it's debatable if waiting to see if a higher fixed rate is offered makes sense for a majority of buyers.
https://fred.stlouisfed.org/series/DFII5
And as a reminder, the November rate will still be in effect until May of 2023. If they happen to raise the fixed rate > 0%, you can buy your 2023 allocation with the November rate.
harmony
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Accessing spouse's I-bonds for LTC

Post by harmony »

[Thread merged into here --admin LadyGeek]

Both of us are at an age where funds for long-term care could be needed within 1-15 years. One of us has a Treasury Direct account and has been adding $10K annually. I-bonds are not our only source of LTC funding. We are shifting some funds to I-bonds for the inflation protection. This isn't a question about where to invest LTC funds. This is a question about the logistics of accessing I-bonds of the spouse in LTC by the spouse not in LTC.

We are opening a Treasury Direct account for the other spouse. We have the account number for the second spouse but it can’t be accessed until identity is verified through a financial institution’s guaranteed signature. We’ve gotten that done and are about to mail it in. That process takes an average of 13 weeks, so we may miss a chance to buy in 2022. We have read this Q&A about View/Transact Rights from the Treasury Direct website.
May I grant View/Transact Rights to another TreasuryDirect account holder for my marketable securities?
Yes. You may grant View rights to a security held in your name to any individual TreasuryDirect account holder. View and/or Transact rights may be granted to the second-named registrant of a security with Primary Owner registration. View rights may also be granted to the Beneficiary of a security with that registration. Transact rights allow the second-named registrant, or grantee, to transfer a security, as well as change the maturity and/or interest payment destination. View/Transact rights are not available in entity accounts.
How does one proceed? Do we open the Primary Owner account for the spouse; then add the second spouse as Beneficiary so that they can access the other spouse’s funds? Or is it better to add the spouse as a secondary owner? Does being a secondary owner limit the secondary owner from adding $10K annually to their own account? Are View/Transact rights so limited that a Durable Power of Attorney is required for accessing the funds? Finally, for anyone who has tried to access I-bonds of a spouse in long term care, what would you advise?
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LadyGeek
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by LadyGeek »

I merged harmony's thread into the ongoing discussion.

(Thanks to the member who reported the post and provided a link to this thread.)
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.
evelynmanley
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Re: Accessing spouse's I-bonds for LTC

Post by evelynmanley »

harmony wrote: Wed Sep 28, 2022 10:49 am [Thread merged into here --admin LadyGeek]

Both of us are at an age where funds for long-term care could be needed within 1-15 years. One of us has a Treasury Direct account and has been adding $10K annually. I-bonds are not our only source of LTC funding. We are shifting some funds to I-bonds for the inflation protection. This isn't a question about where to invest LTC funds. This is a question about the logistics of accessing I-bonds of the spouse in LTC by the spouse not in LTC.

We are opening a Treasury Direct account for the other spouse. We have the account number for the second spouse but it can’t be accessed until identity is verified through a financial institution’s guaranteed signature. We’ve gotten that done and are about to mail it in. That process takes an average of 13 weeks, so we may miss a chance to buy in 2022. We have read this Q&A about View/Transact Rights from the Treasury Direct website.
May I grant View/Transact Rights to another TreasuryDirect account holder for my marketable securities?
Yes. You may grant View rights to a security held in your name to any individual TreasuryDirect account holder. View and/or Transact rights may be granted to the second-named registrant of a security with Primary Owner registration. View rights may also be granted to the Beneficiary of a security with that registration. Transact rights allow the second-named registrant, or grantee, to transfer a security, as well as change the maturity and/or interest payment destination. View/Transact rights are not available in entity accounts.
How does one proceed? Do we open the Primary Owner account for the spouse; then add the second spouse as Beneficiary so that they can access the other spouse’s funds? Or is it better to add the spouse as a secondary owner? Does being a secondary owner limit the secondary owner from adding $10K annually to their own account? Are View/Transact rights so limited that a Durable Power of Attorney is required for accessing the funds? Finally, for anyone who has tried to access I-bonds of a spouse in long term care, what would you advise?
Take a look at Harry Sit's archives about I-bonds which cover all of your questions. There are two pages:

https://thefinancebuff.com/tag/i-bonds
MrWig
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by MrWig »

Question on the Gift Box process
If I put 10k in the gift box in year 1, then actually gift it in year 3, the recipient receives $10k face value plus the accrued interest right? Would this not put the recipient over the $10k annual limit? Or is the accrued interest transferred to recipient but not considered toward the annual limit.
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Nate79
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Nate79 »

MrWig wrote: Wed Sep 28, 2022 2:14 pm Question on the Gift Box process
If I put 10k in the gift box in year 1, then actually gift it in year 3, the recipient receives $10k face value plus the accrued interest right? Would this not put the recipient over the $10k annual limit? Or is the accrued interest transferred to recipient but not considered toward the annual limit.
The interest doesn't count towards the contribution limit.
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