I Bonds

[alldodge]

Admiral and I did the online sign up June 14 to purchase I Bonds (current 9.62%). At the time both came bak with unable to verify, please fill out this form and get a Bank Medallion stamp signature. Ok everyone want's to get it so this may help ferret out the Bots. Estimated wait 10 to 15 DAYS.

Today get an email saying they are backlogged and can take up to 13 WEEKS

Good grief

 

[tpenfield]

An extended family member mentioned 'iBonds' recently and I was not familiar with them. Seems like a high interest rate just for an introductory period, then a lower rate thereafter. ??? (Not sure)

I'm currently looking at buying some high(er) paying dividend stocks to bolster my semi-retirement income

 

[alldodge]

The Bonds are high because the Fed rate is up. Buying them doesn't mean folks continue to get the rate, as Fed goes up and down so does do the Bonds.

Highest rate savings account is still Marcus at 1.2%, local is still 0.1.
Marcus raises rates as the Fed rate goes up and many times in the middle of a month, just does it. Electronic transfer from bank account either direction in one day

 

[Buster53]

Yep, just bought 2 in the past couple months...one for me and one for the admiral. On one of the applications, we had to go thru the medallion stamped form and it took about 8 weeks.
Treasury changes rates every May and Nov, but the way I understand it, when you buy it, you get the full 6 months of the current rate, right now at 9.62%...nothing to sneeze at. And I'm guessing, come November, it's not coming down and may even go higher.
Downsides...must hold for a minimum of 1 year and if you redeem it in under 5 years, you give up the last 3 months of interest.
One positive....exempt from state taxes.
While I have money with Marcus and happy to be with them, right now, the I Bond is a no brainer.

 

[tpenfield]

I saw an article that says you can buy up to $10,000 annually and another $5,000 using your tax refund (if you get one )

The interest is compounded monthly, which contributes to the annual yield.

 

[alldodge]

Agree, its a great deal
You pay taxes on the interest every year, so when it is cashed out its all yours

 

[Buster53]

Agree, its a great deal
You pay taxes on the interest every year, so when it is cashed out its all yours

The way I understand it, you can pick how to pay taxes, either every year or when you cash out and as mentioned, exempt from state taxes

 

[alldodge]

The way I understand it, you can pick how to pay taxes, either every year or when you cash out and as mentioned, exempt from state taxes

Wasn't how I read it, but you may have a better understanding then I
They are exempt form state and local tax

 

[Buster53]

I saw an article that says you can buy up to $10,000 annually and another $5,000 using your tax refund (if you get one )

I’m actually considering bumping up my withholding to get a bigger refund just to take advantage of this. 9.62% is a hell of a deal and may even go higher in Nov.

 

[Buster53]

The way I understand it, you can pick how to pay taxes, either every year or when you cash out and as mentioned, exempt from state taxes

Ok, as advised by treasurydirect.gov, I’m going to check with my tax advisor to confirm this. Details to follow.

 

[Buster53]

Ok, checked with my tax guy and he confirmed I could either pay yearly or once when redeemed. I’m guessing the yearly option is best for most people as a big lump sum might bump you into a higher tax bracket.

 

[johnt_mn]

I got $10k for me and tried to get $10k for my wife but entered the bank number wrong on hers, now waiting on the Medallion deal to get bank info changed - it's already been six weeks. The website is horrible, like something from about 1996.

If you're looking for a decent savings account rate, I've got an account at lendingclub.com paying 1.52%, FDIC, no minimums or fees.

 

[Buster53]

I got mine done ok, but did something to mess up my wife's application. Had to go through the Medallion Stamp process as well, took 8-9 weeks.
At least we only have to do that once and can easily buy more bonds in the future.

 

[alldodge]

Looking at lending club, does show higher yield, and will look into it further. When you call Marcus you talk to a person, when you call lending club you don't right away. Nerd wallet gives them high marks and list the APR but does not list them in the top for 2022. I need to look further, thanks for the tip

 

[johnt_mn]

Looking at lending club, does show higher yield, and will look into it further. When you call Marcus you talk to a person, when you call lending club you don't right away. Nerd wallet gives them high marks and list the APR but does not list them in the top for 2022. I need to look further, thanks for the tip

No problem. I've never tried to talk to an actual person there, but to their credit they seem to have a very good website with easy access to everything I've needed. I ran across them about 5 years ago when I did a test of "peer to peer lending" by investing $5k with them in consumer loans. The longest loan term was 5 years so that test has ended and I earned about 6.5% interest annually over that period. Not a big deal and I don't think they even offer that service anymore, but it proved to me that they run their business well. They acquired a regional savings bank a couple years ago and added it to their online presence recently.