Picking up Nickels

Wednesday, October 18, 2017

September 2017 CPI-U numbers released: November 2017 I Bonds are a buy!

The U.S. Bureau of Labor Statistics released the September 2017 Consumer Price Index (CPI-U) inflation data last week, which increased by 0.53% over the past month.

As always, now 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 October 2017 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 March 2017 (243.801) and September 2017 (246.819) (courtesy of inflationdata.com), we can calculate the variable rate for the second 6 month period for October 2017 issue I Bonds.

That means these bonds would earn the current rate of 1.96% (using 0% fixed & 0.98% variable) for the first 6 months and 2.48% (combined 0% fixed & 1.24% variable) for the second 6 months. IMO, the current 1.96% rate makes it a toss up when it comes to deciding on an October vs. November purchase. You can either buy now and lock in the known attractive rates for twelve months, or you can hold off until November and hope that the fixed portion rises from the 0% currently offered. Either option is attractive when compared to short term investments like the 1 year CD @ 1.65% APY currently being offered at The First State Bank.

I already maxed out my 2017 purchase limit in January, so I'm only an observer at the moment. However, I will likely be buying in January 2018 due to the 2.48% (minimum) rate that will be available to me next year.

Wednesday, October 11, 2017

October 2017 Financial Asset Roundup

Here are my current financial assets as of the market close on October 10th, 2017:

Asset Sep
Checking 832 491 -341
Money Market 69,541 66,489 -3,052
Savings Bonds 136,721 137,015 294
Treasury Bills 0 0 0
CDs 41,558 41,671 113
Brokerage 160,442 153,160 -7,282
401k 159,792 161,984 2,192
Roth IRA 136,948 139,904 2,956
SEP IRA 661,119 685,532 24,413
529 Savings 164,194 166,232 2,038

Total Assets $1,531,147 $1,552,478 $21,331

The S&P 500 has continued to hit all time highs since the last update, rising 2.51% during that time:

(chart courtesy of google.com)

On the jobs front, the unemployment rate for September dropped to 4.2%, although 33,000 jobs were lost courtesy of Hurricanes Harvey and Irma. Oil prices are up slightly to the $51 level, while hurricane-inflated gas prices have started to fall locally ($2.52 at my last fillup).

On the financial front, my asset levels have reached an all-time high for the ELEVENTH month in a row, breaking the previous high from September 2017. I don't foresee any money moves, although I will be keeping an eye on the September CPI-U numbers when they are released on Friday even though I have already maxed out my 2017 I Bond limit.

As for the non-financial, I've spent most of my time tinkering on various small projects around the house. I've been enjoying the seasonably warm weather, but am not looking forward to the cold weather that will follow.