Post #595 by Mark on the Retirement Investing board

Personal Finance Topics / Retirement Investing

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I bonds are easier to understand, but you can't put much money into them. We buy our $20k allotment each year. The ones we still have from 2001 are doing well.

I-bonds have a substantially lower overall yield than TIPS have right now. And indeed, the 1998 through 2001 I-bonds are excellent with the 3 to 3.6% fixed portion of the yield added to CPI each year. But I definitely wouldn't be buying I-bonds nowadays, if I wanted to buy inflation linked instruments, I would buy TIPS instead.

I Bonds can be used to pay for college, and no tax is due on the interest, a nice perk if you can use it.

Yes, but there are income limitations, and that limitation is somewhat low. I retired a few years ago and each year so far, my income has been surprisingly high, so I haven't been eligible. Besides, I don't want to give up my 2000/2001 vintage I-bonds early, I'd rather wait till they mature and accrue that sweet CPI+3% for as long as possible.

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