March CPI-U numbers released: Buy April 2022 issue I Bonds Now!
The U.S. Bureau of Labor Statistics released the March 2022 Consumer Price Index (CPI-U) inflation data last Tuesday, which rose by 1.34% last month, a historically large increase.
As always, now (along with the release of the September CPI-U) is one of the best times to consider purchasing I Bonds. The reason for this is that we now know what the rate of return for April 2022 I Bonds will be for both the first and second six month periods, which is important since I Bonds must be held for 12 months before they can be redeemed.
Using the CPI-U data from September 2021 (274.310) and March 2022 (287.504) (courtesy of inflationdata.com), we can calculate the variable rate for the second 6 month period for April 2022 issue I Bonds.
That means these bonds would earn a composite rate of 7.12% (using 0% fixed & 3.56% variable) for the first 6 months and 9.62% (using 0% fixed & 4.81% variable) for the second 6 months. Based on this inflation spike, April 2022 issue I Bonds are a screaming hot buy when compared to something like the 12 month CD @ 1.31% APY currently being offered by Luana Savings Bank.
So, should you wait until May to get that 9.62 rate?. No, a thousand times no! If you buy I Bonds before May you will get a guaranteed 7.12% return for six months followed by 9.62% for the six months after that. If you like money, my advice is to back up the truck and buy now!
As always, now (along with the release of the September CPI-U) is one of the best times to consider purchasing I Bonds. The reason for this is that we now know what the rate of return for April 2022 I Bonds will be for both the first and second six month periods, which is important since I Bonds must be held for 12 months before they can be redeemed.
Using the CPI-U data from September 2021 (274.310) and March 2022 (287.504) (courtesy of inflationdata.com), we can calculate the variable rate for the second 6 month period for April 2022 issue I Bonds.
That means these bonds would earn a composite rate of 7.12% (using 0% fixed & 3.56% variable) for the first 6 months and 9.62% (using 0% fixed & 4.81% variable) for the second 6 months. Based on this inflation spike, April 2022 issue I Bonds are a screaming hot buy when compared to something like the 12 month CD @ 1.31% APY currently being offered by Luana Savings Bank.
So, should you wait until May to get that 9.62 rate?. No, a thousand times no! If you buy I Bonds before May you will get a guaranteed 7.12% return for six months followed by 9.62% for the six months after that. If you like money, my advice is to back up the truck and buy now!
posted by Frugal Frugalson at
2:12 PM
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