Series I Savings Bond Guide
The New Investor's Guide to Using Bonds to Protect Against Inflation
The Series I savings bond from the United States Treasury is a great way for new investors to protect themselves from inflation. Although the series I bonds are a type of zero-coupon, savings bond, meaning you won't receive interest checks in the mail but rather your interest income will be added to the value of the bond and compound until you sell the savings bond back to the United States Government, they provide unique protections and a guarantee that they will never lose money.
This introduction to the Series I savings bond was designed to help new investors understand how the I bond can protect you from inflation, how you actually make money when you own I bonds, an explanation of the possible risks you face with these unique savings bonds, and much more. If you are considering adding the Series I savings bond to your fixed-income portfolio, you need to start here for an overview. It will give you a great broad-based understanding before getting into more in-depth areas.
Not everyone can own I bonds or other types of savings bonds due to restrictions put in place by the United States Government. In some cases, you may only be eligible to invest in the electronically registered savings bonds through the TreasuryDirect program and not physical paper bond certificates, further complicating the matter. Find out if you qualify to add these savings bonds to your portfolio by quickly checking over this list.
The Series I savings bond program features strict limitations on the total value of the bonds you can purchase each year. In fact, these savings bond purchase limits actually vary based on whether you are buying physical paper certificates or electronically registered securities. Smart investors can learn how to combine the two purchase methods to buy more savings bonds than they otherwise could.
If you are ready to open your pocketbook and start buying Series I savings bonds, there are four ways you can complete your transaction and start earning interest income.
If you use your Series I savings bonds to pay for qualified education expenses, you may not have to pay tax on the income you generated from investing in those bonds. This special will explain the tax advantages of investing in I savings bonds and other considerations you may want to factor into your decision about whether they are right for your portfolio.
The interest income you earn on your Series I savings bonds is calculated very differently from most other bonds because it consists of two parts—a fixed rate and an inflation modifier.
Don't have a clue what the symbols, dates, figures, and codes on the Series I savings bonds mean or why you should care?
Want to see what a $5,000 Series I savings bond looks like? These high-resolution images of the Series I savings bonds are provided by the United States Treasury Department and feature some of the most remarkable Americans throughout the nation's history. Each Series I bond images shown is what investors receive when they invest in the paper certificate version of the savings bond program.
Did your house burn down? Did you lose all record of your savings bond ownership? What are you supposed to do if you lose your Series I savings bonds?
For those who want information on savings bonds in general and not just the Series I savings bond, this special will provide a much broader overview. Topics covered include the history of savings bonds, how to determine if you should have savings bonds in your own portfolio, and ways to minimize taxes on your savings bonds.
Once you've finished reading and learning about the Series I savings bonds, you may want to research Series EE savings bonds. These unique products don't offer inflation protection, but instead, have a fixed rate interest level that lets you calculate how much you'll earn on your bond for the entire time you hold it. Series EE bonds can be purchased in addition to Series I bonds because each program has its own annual purchase limits.