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In my personal calculations, I've been comparing the return from I bonds to CDs. Right now, the I bond provides higher interest than CDs have provided since the
by dangle1 4y ago
In my personal calculations, I've been comparing the return from I bonds to CDs. Right now, the I bond provides higher interest than CDs have provided since the 80s.
However, since the I bond term readjusts in 6 mo intervals, it's possible for CD rates to catch up in the next two years as interest rates rise.
So if there is anything 'golden' about the situation, it's the opportunity to (perhaps briefly) receive 80s-era guaranteed interest rates.
- gkuan 4y agoOne interesting thing is that even nominal Treasuries are yielding above CDs at the moment but the difference is more like 20 bps or so. Can you imagine the people who bought i bonds in the 2000s when the fixed yield part of the return was 3.6%? Though they obviously had their ups and downs, but right now if they held on they are sitting on a year of 10%+ yields.