I-Bonds: Current Rate, How to Buy & Is It Worth It?
Series I Savings Bonds combine a fixed rate with inflation protection, making them one of the safest investments available. Here is everything you need to know.
Current I-Bond Rate
Rate effective November 1, 2025 - April 30, 2026. Next rate announcement: May 2026.
How the I-Bond Rate Works
The I-Bond composite rate has two components:
- •Fixed rate (0.90%) — set when you buy and stays the same for the life of the bond (up to 30 years)
- •Inflation rate (3.12% annualized) — resets every 6 months based on CPI-U inflation data
The composite rate is recalculated every May and November. Your bond earns the rate that was in effect when you bought it for the first 6 months, then switches to the new rate. The fixed rate portion never changes, which means bonds purchased when fixed rates are high keep that advantage forever.
Projected Value of $10,000 in I-Bonds
If the current 4.03% composite rate stayed constant (it will change every 6 months):
*Redemption before 5 years forfeits the last 3 months of interest. Values shown include this penalty for years 1 and 3.
How to Buy I-Bonds
- 1.Create a TreasuryDirect account
Go to TreasuryDirect.gov and create an account with your SSN and bank information. The site looks dated but is the official U.S. Treasury platform.
- 2.Buy in any amount from $25 to $10,000
Electronic I-Bonds can be purchased in any amount (including cents) up to the annual limit. Funds are debited from your linked bank account.
- 3.Optional: Buy $5,000 more with your tax refund
File IRS Form 8888 with your tax return to direct up to $5,000 of your refund into paper I-Bonds. This is in addition to the $10,000 electronic limit.
I-Bonds: Pros and Cons
Advantages
- •Inflation protection built in (rate adjusts with CPI)
- •State and local tax exempt
- •Federal tax deferred until redemption
- •Backed by the U.S. government
- •Fixed rate component locked in at purchase
Drawbacks
- •$10,000/year purchase limit per person
- •12-month lockup (cannot redeem before 1 year)
- •3 months interest if redeemed before 5 years
- •TreasuryDirect website is clunky and outdated
- •Cannot be traded or sold to others
Frequently Asked Questions
What is the current I-Bond rate?
The current I-Bond composite rate is 4.03%, made up of a 0.90% fixed rate plus a 3.12% annualized inflation rate. This rate applies for 6 months from when you buy. The rate was set on November 1, 2025.
How much can I buy in I-Bonds?
You can buy up to $10,000 in electronic I-Bonds per person per calendar year through TreasuryDirect.gov. You can also buy an additional $5,000 in paper I-Bonds using your federal tax refund. Married couples can buy $20,000 electronic + $10,000 paper per year combined.
When can I cash in my I-Bonds?
I-Bonds must be held for at least 12 months. If you redeem before 5 years, you forfeit the last 3 months of interest. After 5 years, there is no penalty. You can hold I-Bonds for up to 30 years.
Are I-Bonds better than a HYSA or CD?
It depends on rates and your timeline. I-Bonds have a 0.90% fixed rate that is guaranteed for the life of the bond plus inflation protection. They are exempt from state tax and you can defer federal tax. The downside is the 12-month lockup period and $10,000 annual limit. A HYSA gives you instant access, and CDs may offer higher rates for specific terms.
Do I pay taxes on I-Bond interest?
I-Bond interest is State and local tax exempt, federal tax deferred until redemption. If you use the proceeds for qualified education expenses, the interest may be completely tax-free. This makes I-Bonds one of the most tax-efficient savings vehicles available.