Ibonds for the longer term

dilettante said:
Sounds good. Widely advised. I don't do it.

But over the last 12 months (rolling) I got returns of over 39% on my 401(k). YTD only 24%, but that's the stock market for you.
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If you don’t rebalance periodically the market will eventually do it for you. 😉🤭😂

If letting it ride works for you then go for it.
 

you can always tell the non investors by there terms they use like playing the market or gambling .

the real deal is cash instruments and fixed income have been the real losers and gambling as they have failed to even keep up with inflation and taxes and have produced negative real returns more often then not .

at a 4% inflation adjusted draw rate fixed income is gambling as 64% of every one of the 123 rolling 30 year periods we have had to date that ran out of money before 30 years .

on the other hand a 60/40 has a 95% success rate .

90% of the time it ended with more than one started with .

so for all you non investors out there you need to learn the difference between gambling and investing
 

mathjak107 said:
you can always tell the non investors by there terms they use like playing the market or gambling .

the real deal is cash instruments and fixed income have been the real losers and gambling as they have failed to even keep up with inflation and taxes and have produced negative real returns more often then not .

at a 4% inflation adjusted draw rate fixed income is gambling as 64% of every one of the 123 rolling 30 year periods we have had to date that ran out of money before 30 years .

on the other hand a 60/40 has a 95% success rate .

90% of the time it ended with more than one started with .

so for all you non investors out there you need to learn the difference between gambling and investing
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As usual you have nailed it. Do you think the current 1.2% fixed rate would allow for at least breaking even with inflation for most people in the lower tax brackets?
 
StarSong said:
And some of us don't have the stomach for the stock market.
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I tried it a couple times, broke even once, and lost my shirt the next time. I recently got back into it, but with a very small investment, and bought another thousand, each time it went down. I'm up about 4%, but I'm doing that with my CDs and I bonds, where I feel comfortable, but no plans for getting rich.
 
JustDave said:
I tried it a couple times, broke even once, and lost my shirt the next time. I recently got back into it, but with a very small investment, and bought another thousand, each time it went down. I'm up about 4%, but I'm doing that with my CDs and I bonds, where I feel comfortable, but no plans for getting rich.
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Yes. I have a little in mutual funds, and my experience had generally been similar to yours.
 
FYI, for those of your thinking of purchasing another Ibond this year with its 1.2% plus inflation rate, keep in mind that you will no longer get a paper Ibond. They will all be held electronically in a Treasury Direct account. Also, you can no longer get your income tax refund (up to $5000 max) in Ibonds. So the yearly limit is $10,000 and that is pretty firm unless you engage in more complicated things like the gift program.

IMO, if they are going to “modernize” the program, they should also modernize the yearly contribution limit, which has not been adjusted for inflation. Had it been adjusted the yearly contribution rate would be about $25,000 a year.
 
I was considering cashing in my IBonds in November when the rates dropped, but decided to hold onto them. With the promised tariffs that are supposedly now coming to fruition, inflation will soon be rearing its ugly head again.
 
StarSong said:
I was considering cashing in my IBonds in November when the rates dropped, but decided to hold onto them. With the promised tariffs that are supposedly now coming to fruition, inflation will soon be rearing its ugly head again.
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That's what I've been reading from analysts on Wall Street and the Business columns. This months report may just be an odd accounting glitch, since my money market account has held steady. I think they both react the same to the economic data. But I really don't know that.
 
StarSong said:
I was considering cashing in my IBonds in November when the rates dropped, but decided to hold onto them. With the promised tariffs that are supposedly now coming to fruition, inflation will soon be rearing its ugly head again.
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more than likely the opposite .

certain goods are going to suck more money away from all the other companies world wide and they are going to suffer .

people can’t afford to buy this and that so they will have to select this or that and choose where their money goes .

most economists see this as higher unemployment and a slowing global economy .

the bet is the fed will have to lower rates. faster then they anticipate.

the bond markets seem to agree with this as yields are down
 
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I’ve still got a handful that’ll mature in 2031. They continue to pay a not too shabby rate tho so i’m in no rush to cash them in.
 
I see the May 1, 2025 rate has been published, but I find this chart on the Treasury Depts. website unclear. Would someone let me know what rates older Ibonds are paying? For instance, what overall interest rate will be paid for the bonds I bought November 2024? 4.08% or 3.11%? November 2023 - 3.77% or 4.30? Or something else?
https://www.treasurydirect.gov/files/savings-bonds/i-bond-rate-chart.pdf

Thanks in advance.
 
My iBonds fluctuate each month, maybe depending on the length of the month. But iBonds I bought in in 2003 consistently pay about a percent higher than the combined iBonds I have bought in the last 3 years.
 

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