Charles Forelle

speaker

205 appearances 2 recordings 1 series first heard Jan 2022 last heard Oct 2022

Charles Forelle’s voice in public audio — every appearance, attributed to the second.

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And then there's an inflation adjustment, and the inflation adjustment happens every six months.

And every May and every November, they set new rates.

And those rates apply for

six months for any bonds bought in the period between November and May or May and November.

So if you buy a bond in January, you get the rate from the last November.

That will be good for six months, so from January to June.

And then you'll get the new rate, the one that was announced in May.

So every six months, your rate changes and the inflation adjustment changes.

I bond interest rates compound semi-annually.

So every six months,

They take the interest, they add it on to the principal, and it compounds.

So it's not compounded monthly, it's compounded every six months.

So inflation is still 8% higher than it was a year ago, but it is not 8% higher than it was six months ago.

So what's happened is inflation shot up, and then inflation sort of plateaued for a little while, and since we're in this plateau...

It's increasing a little bit month on month, but it's not increasing as massively as it was earlier in the year.

We're starting to see that effect roll back.

So the reason for that is because it's only looking back six months, not a whole year.

This is not financial advice, but if you are thinking about buying an iBond on November 1st, you'll get a rate of 6.47 or thereabouts.

If you buy it on October 31st, you'll get a rate of 9.62 for six months.

So think about it.

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