The Name's Bond, I-Bond

[Spur08 384]

Series I savings bonds are currently paying out at 9.62% through Oct '22.   Given the current inflationary environment, is this an ideal investment vehicle?  I only have a basic understanding of T/I-bonds, so I'm wondering what long-term advantages a purchase could have for a mid-30-year-old w/ 2 kids under 4.  For what it's worth, Cramer says they're garbage so guaranteed win, right?

 

[baboso 6105]

Limited to $10K per year.  Rate adjusts every 6 months, so potential for lower (or higher) rates.  I believe you have to hold them for 5 years or face a  penalty of some percentage of lost interest.

[gyroprotagonist 2597]

2 hours ago, baboso said:

Limited to $10K per year.  Rate adjusts every 6 months, so potential for lower (or higher) rates.  I believe you have to hold them for 5 years or face a  penalty of some percentage of lost interest.

penalty is the last 3 months of interest, iirc.  you can open them for each member of the family up to 10K.  fin planner suggested we look at them as a short term investment for the kids as  their 529 plans are basically funded to a level that should cover their education and it may not make sense to keep adding to it (they are both in middle school).  

The main downside is 10K limit from what i have seen.  not sure how I bonds compare with TIPS bonds, though.  

[Spur08 384]

And my understanding is only a portion of the interest is fixed, probably the smaller portion.  The variable rate (changes every 6 months?) is based off the CPI?  So while it's paying pretty damn great right now, is it worth locking in for 2 years? 5?

[Parliament 14598]

Should I buy this in my retirement account, or regular, taxed account?