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Portfolio > Economy & Markets > Fixed Income

New I Bond Rate Set at 6.89%

By Dinah Wisenberg Brin

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The Treasury Department has reset the interest rate for Series I savings bonds to 6.89% for bonds issued Tuesday until April 30, 2023, down from the 9.62% rate that prompted a flood of purchases last month.

Consumers buying the inflation-adjusted bonds will earn the new rate — lower but nonetheless among the highest ever for the securities — for six months from the purchase date.

The government resets I bond rates every six months, adjusting the interest using a formula to reflect changes in the Consumer Price Index.

The new rate includes a 0.4% fixed rate that will remain in place for the life of the bond. The fixed rate had been set at zero since May 2020.

Because high traffic on the TreasuryDirect.gov website where I bonds are sold experienced numerous outages and delays last week, many consumers experienced trouble buying the bonds — although the government reported record sales.

The department added website capacity and told ThinkAdvisor on Monday that purchasers bought nearly $1 billion in I bonds on Friday alone. Customers had until just before midnight Friday to purchase the securities and receive emailed confirmation.

Purchases made on Oct. 29 or later will receive the new rate.

Consumers purchased an estimated $3 billion in I bonds last week and nearly $7 billion in October, more than the approximately $5 billion invested in 2021, according to the Treasury Department.

Individuals may purchase or receive up to $10,000 in electronic I bonds per calendar year through TreasuryDirect and $5,000 in paper bonds per year through income tax refunds. I bonds earn interest for 30 years or until redeemed. Holders may cash in bonds after 12 months, but if they do so before five years they’ll forfeit the last three months’ interest.

Dinah Wisenberg Brin

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