Ibond rates bs Tips
Right now I prefer Tips over ibonds. Both pay a fixed rate plus inflation however the fixed rate on I bonds is very small and you can get a fixed rate of around 1.5 percent on TIps meaning you have a 1.5 percent yield ( real rate) above the inflation rate. I have some I bonds purchased in 2002 which have a fixed rate of 3%, so when new bonds were earning over 9 in the past year the 2002 bonds were earning over 12 percent. With I bonds you can choose to pay taxes annually or when you sell them.
|