I-Bond Calculator

Calculate your Series I Savings Bond value with current rates. See how inflation protection grows your investment over time.

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years

Current I-Bond Rates

Composite Rate
5.27%
Nov 2024 - Apr 2025
Fixed Rate
1.30%
Locked at purchase
Inflation Rate
2.96%
Changes every 6 months
Annual Limit
$10,000
Per SSN per year

Your I-Bond Projection

Calculated
Future Value
$0
After holding period
Total Interest
$0
Inflation-protected
Effective APY
0%
Average annual return

Rate Breakdown

Component Rate Description
Fixed Rate 1.30% Locked for 30 years at purchase
Inflation Rate 2.96% Adjusts every 6 months
Composite Rate 5.27% Combined rate (formula below)

Value Growth Over Time

Key Takeaways

  • I-Bonds are inflation-protected savings bonds backed by the U.S. government
  • The current composite rate is 5.27% (Nov 2024 - Apr 2025)
  • Annual purchase limit: $10,000 per person (plus $5,000 with tax refund)
  • Must hold for at least 1 year; 3-month interest penalty if redeemed before 5 years
  • Interest is exempt from state and local taxes; federal tax deferred until redemption

What Are Series I Savings Bonds?

Series I Savings Bonds (I-Bonds) are U.S. Treasury securities that protect your investment from inflation. They earn interest through two components: a fixed rate that stays the same for the life of the bond, and an inflation rate that adjusts every six months based on the Consumer Price Index (CPI-U).

I-Bonds are considered one of the safest investments available because they're backed by the full faith and credit of the U.S. government. They're particularly attractive during periods of high inflation, as the inflation component adjusts to maintain your purchasing power.

How the I-Bond Composite Rate Is Calculated

The composite rate combines the fixed rate and inflation rate using this formula:

Composite Rate = Fixed Rate + (2 x Inflation Rate) + (Fixed Rate x Inflation Rate)
Fixed Rate = Set at purchase, never changes
Inflation Rate = Semiannual rate based on CPI-U

For example, with a 1.30% fixed rate and 2.96% semiannual inflation rate:

Composite = 0.0130 + (2 x 0.0296) + (0.0130 x 0.0296) = 0.0130 + 0.0592 + 0.0004 = 5.26%

Pro Tip: Fixed Rate Lock-In

The fixed rate you get is locked in for 30 years. If you see a historically high fixed rate (like the current 1.30%), it's a great time to buy. Even if inflation drops later, you'll always earn that fixed rate on top of whatever the inflation adjustment is.

I-Bond Purchase Limits

The Treasury limits how many I-Bonds you can purchase each calendar year:

  • $10,000 per person in electronic I-Bonds (via TreasuryDirect.gov)
  • $5,000 additional in paper I-Bonds (purchased with tax refund only)
  • Each person with a Social Security Number can buy up to $15,000 total
  • Couples can effectively invest $30,000/year (each spouse buys their own)
  • Trusts and businesses with EINs can also purchase $10,000/year

Redemption Rules and Penalties

Important Redemption Rules

  • Minimum holding period: 1 year (you cannot redeem before this)
  • Early redemption penalty: If you redeem before 5 years, you forfeit the last 3 months of interest
  • No penalty after 5 years: Full interest earned after holding 5+ years
  • Maximum term: I-Bonds earn interest for up to 30 years

I-Bonds vs. TIPS: Which Is Better?

Both I-Bonds and Treasury Inflation-Protected Securities (TIPS) protect against inflation, but they work differently:

Feature I-Bonds TIPS
Purchase Limit $10K/year No limit
Minimum Purchase $25 $100
Deflation Protection Yes (rate never goes negative) Principal protected only
State Tax Exempt Exempt
Federal Tax Deferred until redemption Taxed annually
Liquidity 1-year lockup Tradeable anytime
Best For Small investors, emergency funds Large portfolios, retirement accounts

I-Bond Tax Advantages

I-Bonds offer several tax benefits that make them attractive for savers:

  • State and local tax exempt: Interest is never subject to state or local income taxes
  • Federal tax deferral: You don't pay federal tax until you redeem the bond
  • Education exclusion: Interest may be completely tax-free if used for qualified higher education expenses
  • No 1099 until redemption: No annual tax paperwork like with bank CDs

Frequently Asked Questions

New I-Bond rates are announced twice a year: on the first business day of May and November. The inflation rate is based on the change in CPI-U over the preceding 6 months. Your personal rate updates 6 months after your purchase date, not on the announcement dates.

No, the composite rate can never go below zero. Even if deflation causes a negative inflation rate, the composite rate will be set to 0%. This means your principal is always protected - you'll never lose money on an I-Bond due to deflation.

Electronic I-Bonds are purchased through TreasuryDirect.gov. You'll need to create an account with your Social Security Number, bank account information, and email. Paper I-Bonds can only be purchased using your federal tax refund via IRS Form 8888.

Yes! You can purchase I-Bonds as gifts through TreasuryDirect. The gift counts toward your $10,000 annual limit, but it doesn't count toward the recipient's limit until delivered. You can hold gift bonds indefinitely before delivering them.

I-Bonds stop earning interest after 30 years (their "final maturity"). At that point, you should redeem them since they're no longer growing. The Treasury will notify you when bonds reach final maturity.

I-Bonds remain attractive in 2025 for several reasons: the fixed rate of 1.30% is historically high, they provide guaranteed inflation protection, and they're risk-free. They're ideal for emergency funds, education savings, or as a conservative portion of your portfolio. The main limitation is the $10,000 annual cap.