Right before semi-annual rate change to capture good rate locked.

Joint purchase double limit?

Yes \u2014 $10K each = $20K married couple.

I-Bond: no market risk, lower yields. TIPS: marketable, real yield + CPI.

Yes \u2014 tax-free education exclusion if income under threshold.

Selling early \u2014 penalty?

3 months interest lost, year-1 minimum hold.

I-Bond Fixed Rate 2027

I-Bonds 2027: fixed rate set semi-annually (May/Nov), composite rate = fixed + inflation. Max $10K/year per SSN. Hold 1 year minimum.

Purchase Amount ($)

Fixed Rate %

Expected Avg Inflation %

Hold Period (years)

Composite Rate

—

Future Value

—

Net After Tax

—

Purchase	—
Fixed rate	—
Expected inflation	—
Composite rate	—
Future value	—
Interest earned	—
Federal tax (22%)	—
Early withdrawal penalty	—
Net after tax + penalty	—

Series I Savings Bonds (I-Bonds) combine a fixed rate component (set semi-annually, locked for 30 years) with an inflation-adjusted variable rate. Major appeal for inflation protection. $10,000/year max per person ($25K with paper bond from tax refund).

Composite Rate Calculation

Composite = Fixed + Inflation + (Fixed × Inflation). Inflation: 6-month CPI-U change × 2. Fixed: set semi-annually (May 1, Nov 1) by Treasury — historic range 0% to 3.6%. Once locked, fixed component stays for 30-year life.

Tax Advantages

Federal taxable but state/local exempt. Defer federal tax until redemption — major benefit. Use for qualified education expenses: tax-free if MAGI under $98K single / $169K MFJ (2024 thresholds). Tax-free for kids in their lower bracket.

Penalties and Limits

Cannot redeem first 12 months. Months 13-60: lose last 3 months interest. After 5 years: penalty-free. $10K/year per SSN. Plus $5K paper bonds from tax refund (Form 8888) — total $15K/year individual.

Last updated May 2026. Sources: Treasury Direct I-Bonds.