I Bonds
 

Does anyone know the answer to this question?
If I buy a US Treasury I Bond will the interest rate ever vary during the term I have the Bond? I Bonds are made up of a fixed interest rate and a variable interest rate based on inflation. If I already have an I Bond and the inflation goes down will the interest rate on the I Bond I already have also go down or does it stay the same for the full term of the bond?
Also are there any costs like buy, sell or manage etc associated with having I Bonds?

The interest rate is fixed, but the bonds principal increases based on an inflation index. When the principal increases, it is considered taxable income during the year, causing you to have to pay taxes even though no cash flow is generated from the principal accrual portion of the bonds taxable income. The easiest way to invest in them is through a dedicated I bond mutual fund with the likes of Vanguard of Fidelity.

I Bonds
 

I don't care about mutual Funds, taxable income etc.
I only want to know if the current 6.85% on I Bonds will be good for the entire 30 years of the bond or does the Bond I currently have at that rate change at any time during the 30 years when the inflation rate goes down?

The variable rate on an I Bond changes every 6 months - Spring and fall. The fixed rate has been 0% for a long time and in November finally came back at a rate that isn't going to put a dent into anything you care about. Many Youtube Videos to explain how an I Bond works. My guess is you are looking for stability such as a T bill.

I bond rates will change based upon the rate of inflation

You would be wise to have a discussion with the experts at one of the big investment houses, as opposed to getting any information from the internet.

The interest rate for an I Bond" resets" every 6 months based on inflation. For comparison the rate on a 30 year conventional fixed rate Treasury Bond is currently about 3% less at 4%. A new auction for these bonds is held once/month.

No fees are involved if you buy directly from the US Treasury or companies like Charles Schwab.

Announcements, Data & Results — TreasuryDirect

I understand the rates change for inflation but my question is when the rate changes does it change the rate of a bond I bought the PREVIOUS year. If i bought a bond in 2022 at 7% and in 2023 the inflation rate goes down will the interest rate on the bond I ALREADY own go down.

Yes, it will. Your rate is only guaranteed for 6 months. If inflation ever gets under control your rate on existing I Bonds could fall to less than 1%.

Yes but does it retroactively change bonds you already own or just new bonds?

Wow, if that is the case I would never want to buy a 30 yr. bond that you have to wait for 5 yrs to take the money without a penalty.

You could look at it this way. If you sell it in less than 5 yrs you lose the last 3 months of interest. If the interest rate is close to 0% at that time, you will not "lose" much:smiley:

Yes, the interest rate will go up or down on a bond you previously purchased.

I bought Ibonds a few months ago at 9.62 %
They are now at 6.89%

If you go to treasury direct.com they have a chart for all ibond rates and all the changes from the date the bond was issued. I tried to post the chart but was unable to do that.

I would not want a variable rate bond. So thanks for clarifying that for me.