Should I buy I Bonds? How do I buy I Bonds?

Buying I bonds can be a smart way to keep up with inflation and earn more interest. But who should buy I Bonds? How do you actually go about getting them? These are questions we'll talk about with our special guest, Linda Stratton, CFP(R)

Linda first bought I Bonds in 2005 and she's recommended them to clients, too. She joins Bridget Sullivan CFP(R) CPA and John Scherer CFP(R) in talking about who I bonds work for and how to actually go about buying them.

First, Linda explains who I Bonds are well suited for--those with a cash stash. In other words, they're pretty liquid and have adequate emergency funds. I Bonds are great for a permanent cash savings account, according to Linda.

The main restriction on I Bonds is that you can't liquidate them in the first year. If you redeem them after year one, but before year 5, you lose one quarter's worth of interest, which isn't a big factor.

Because they're gauged for inflation, they typically, but not always, pay higher interest rates than money market accounts. That's one of their main advantages.
Because of this feature, they're considered a hedge against inflation.

They're also safe because they're US Government bonds.

And the tax on the interest is deferred until you cash them in. They're 30 year bonds, so they stop earning interest after 30 years.

For these reasons, they're a great part of a long term savings plan.

To buy them, you must register and buy them through treasurydirect.gov

Other considerations if you're thinking about investing in them--
You should be okay on a computer. You won't be bombarded with statements and marketing, so you should be able to remember you have them and communicate their existence to other people, for instance, your spouse, and heirs.

You can assign beneficiaries on the accounts.

The website has security measures, so, once again, a modicum of computer literacy is required to buy them.

Linda also likes this investment because they're less tempting to spend than other forms of saving. She finds it fun to look at them a few times a year and feels delight at how she can set them and forget them (but not totally!)

#ibonds #savingsbonds #emergencyfund

Bridget and John met Linda through ACP, or the Alliance of Comprehensive Planners. If you like how we talk about a subject other advisors don't talk about and want to find out more, check out acplanners.org

Linda Stratton
AIO Financial: https://aiofinancial.com/

US Treasury Direct:
https://www.treasurydirect.gov/

View the video transcript with the following link:
https://www.sullivanmermel.com/post/should-i-buy-i-bonds-how-do-i-buy-i-bonds

Видео Should I buy I Bonds? How do I buy I Bonds? канала Friends Talk Financial Planning