The latest spike in inflation has plenty of savers wondering whether it is a good time to buy Series I Savings Bonds. And it is. But one expert says odds look pretty good that it could be an even better time to buy in November or December.
“Prediction: I Bonds are going to get very popular later this year,” wrote David Enna on the Tipswatch.com site, which regularly tracks inflation-adjusted government bonds.
Why? Inflation is again increasingly unpopular.
High inflation heats up interest in I Bonds
Over the last 12 months, the Consumer Price Index for All Urban Consumers increased 4.2% before seasonal adjustment. It was the third consecutive year-over-year increase since the start of the Iran war in late February. And May’s year-over-year CPI was the highest level since April 2023.
Enna points out that the May CPI report, issued June 10, was the second of a six-month string of inflation data that will determine the I Bond’s new variable rate that will be set Nov. 1. The variable rate will be based on inflation for the months of April to September.
“So far, after just two months, inflation has increased 1.49%, which translates to a variable rate of 2.98%. But there are four months left to go,” Enna wrote in a post dated June 10.
I Bonds have two components: a fixed rate that remains with the 30-year life of the savings bond and a variable rate that reflects inflation and adjusts each six months after you bought the I Bond. Buy an I Bond in June, for example, and the variable rate will adjust in December.
The variable rate matters to anyone who has I Bonds, no matter when they were bought, as you’ll see the rate go up or down based on an inflation adjustment that hits every six months after your I Bond was issued.
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The rate being paid now on I Bonds issued from May 1 through Oct. 31 is attractive. We’re talking about a fixed rate of 0.9% that stays with the life of the 30-year bond, plus a solid annualized rate of inflation that will apply to the first six months that you own the bond. In all, the composite rate adds up to 4.26% currently.
By contrast, those who bought an I Bond anytime from Nov. 1, 2025, through April 30, 2026, saw a composite annualized rate at 4.03%. It, too, includes a fixed rate of 0.9% that applies for the 30-year life of the bond.
But Enna has a bit of advice for those who didn’t load up on I Bonds yet in 2026. Maybe, wait until the fall to make a move.
Why some may wait until later in the year to buy I Bonds
I Bond aficionados often try to figure out the very best time to buy I Bonds during the year. They’ll game whether the fixed rate will go up or down when new rates are announced every May 1 and Nov. 1.
We saw a fixed rate of 1.2%, for example, for I Bonds issued from Nov. 1, 2024, through April 30, 2025. And the fixed rate was as low as 0% at certain stretches, such as for I Bonds issued from Nov. 1, 2020, all the way through Oct. 31, 2022.
If inflation continues to sizzle, Enna told the Detroit Free Press, part of the USA TODAY Network, it’s possible that the fixed rate could move to 1% or even 1.2% for I Bonds issued from Nov. 1, 2026, through April 30, 2027. We will not know for certain what that fixed rate or the variable inflation rate will be until the new rates are announced officially on Nov. 1.
Again, you get that fixed rate for the entire 30-year life of the bond.
Some more inflation data in the months ahead, though, typically can give forecasters a better guess in October on whether the fixed rate will go up or down as of Nov. 1.
Enna, who has been tracking I Bond rates for many years, told me on June 20 that there’s a shot that the new fixed rate, which applies to the 30-year life of the bond, indeed could end up being higher than 0.9% for I Bonds issued Nov. 1 through April 30, 2027.
Enna said he bought I Bonds earlier this year but others may want to wait to see if they can get a higher fixed rate when buying in November or December.
I Bonds have some quirky rules
A key point: Savers face limits on how much money they can set aside in I Bonds each calendar year. Typically, you’re looking a limit of up to $10,000 in I Bonds bought online in each calendar year, based on one Social Security number or one employer identification number.
For individual accounts, for example, the limit applies to the Social Security number of the first person named in the registration.
As a result, if you hit your limit of $10,000 in May, for example, you’re not going to be able to load up on more I Bonds until the calendar flips to 2027.
How much does it cost to buy an I Bond? The minimum purchase amount is $25. Yet, you can buy I Bonds in a variety of amounts. For example, TreasuryDirect.gov notes that you could buy an I Bond for $36.73 if that’s what you wanted to do.
All I Bonds will benefit from an inflation-related change in their rates in the months ahead. Enna’s thinking, of course, would benefit the most for someone who gets a higher fixed rate and then plans to hold onto those I Bonds for the next 10 years to 30 years.
To buy I Bonds, you must open an account at TreasuryDirect.gov. You can no longer buy savings bonds at a bank, as was possible many years ago.
If you sell an I Bond before you’ve held it for five years, you are looking at a slight penalty.
You lose the last three months of interest, if you cash in an I Bond in less than five years. The TreasuryDirect.gov site gives an example: “If you cash in the bond after 18 months, you get the first 15 months of interest.”
After five years, Enna said, the interest penalty goes away, and you can redeem at any time. But remember, you can only cash or redeem I Bonds after 12 months. If you need the money in three months after the I Bond was issued, you’re out of luck.
Before the Iran war began in late February, inflation had been cooling down on many levels and Enna and others even expected a decent drop in interest rates for I Bonds. Not so anymore — and that’s why more eyes will be on I Bonds through the rest of 2026.
Contact personal finance columnist Susan Tompor: stompor@freepress.com. Follow her on X @tompor.
This article originally appeared on Detroit Free Press: Should you buy I Bonds now or wait? Latest rates, November outlook