I-Bond Real Yield Calculator
Calculate Series I Savings Bond real return after inflation and taxes.
Compare I-Bond yield to TIPS, Treasuries, and HYSA for inflation-protected income.
Series I Savings Bond (I-Bond)
I-Bonds combine a fixed real rate with inflation protection. The composite rate adjusts every 6 months based on CPI-U.
The composite rate formula: Composite = Fixed rate + 2 × Inflation rate + (Fixed × Inflation)
For practical purposes the cross-product is small: Composite ≈ Fixed rate + 2 × Inflation rate
Where inflation rate is 6-month CPI-U change, not annualized. The 2× factor in the formula effectively annualizes it.
Recent fixed rates (set by Treasury, semi-annually):
| Period | Fixed Rate |
|---|---|
| Nov 2024 - Apr 2025 | 1.20% |
| May 2024 - Oct 2024 | 1.30% |
| Nov 2023 - Apr 2024 | 1.30% |
| May 2023 - Oct 2023 | 0.90% |
| Nov 2022 - Apr 2023 | 0.40% |
| Older periods | 0.00% to 3.40% |
Composite rate examples:
- May 2022 - Oct 2022: 9.62% (record-high inflation)
- May 2024 - Oct 2024: 4.28%
- Nov 2024: 3.11%
I-Bond rules:
- Purchase limit: $10,000/year per person via TreasuryDirect ($5,000 extra paper via tax refund)
- Hold time: 1 year minimum (cannot redeem at all in first 12 months)
- Early redemption penalty: lose last 3 months of interest if redeemed in years 2-5
- Maximum hold: 30 years
- Tax treatment: federal tax only (NO state tax), tax-deferred until redemption
- Education exclusion: I-Bond interest tax-free if used for qualified higher education
I-Bonds vs alternatives:
| Investment | Yield (typical) | Inflation Protection | Risk |
|---|---|---|---|
| I-Bond | ~3-5% | YES (CPI-linked) | Government |
| TIPS | ~2-3% real + CPI | YES | Government |
| HYSA | ~4-5% | NO | FDIC-insured |
| 10-year Treasury | ~4-5% nominal | NO | Government |
| Money Market | ~4-5% | Partial | Sweep risk |
| Series EE | ~2-3% | NO (but doubles in 20 years) | Government |
When I-Bonds win:
- High inflation periods (2021-2023 sweet spot)
- Long-term emergency fund parking (after 1-year lockup)
- Tax-deferred income for high earners (no state tax)
- Education savings (tax-free if qualified)
When other instruments win:
- Need liquidity (HYSA wins — no lockup)
- Low inflation environment (TIPS or Treasuries with higher fixed rates win)
- Already maxed at $10K/year (must use other instruments)
- Don’t want TreasuryDirect hassle (their UX is famously bad)
The “30-month flip” strategy: Some investors hold I-Bonds for exactly 30 months: get 27 months of interest, lose 3-month penalty. Maximizes inflation hedge while keeping average duration short.