Buying I bonds for yourself or as a gift?
Running Point and its chief investment officer, Michael Ashley Schulman, CFA, were quoted by USA Today in two different articles regarding I bonds — in one article by Ashlyn Brooks and Farran Powell, “How often can you buy I bonds” and in another by Ashlyn Brooks and Stephanie Steinberg, “Can I buy I bonds as a gift for someone else?” — discussing the purchase and gifting of I bonds as well as their general appeal.
Note: I bonds are U.S. government Series I inflation-linked savings bonds.
How to buy I bonds as a gift—it’s tricky!
You can buy I bonds as gifts for friends, family members, or others, but unless you know the recipient very well, it may be difficult to do. You need the giftee’s Social Security number and other personal information to set up an online account for them at Treasury Direct before purchasing the bond.
Additionally, since there are annual limits (of $5,000 to $15,000) regarding how much an individual can purchase, you want to verify that you are not buying more for them than what is allowed.
Additionally, it’s important to note that while I bonds can be a great gift, they come with certain restrictions and limitations, so it’s a good idea to research and understand the terms and conditions before purchasing.
I bond interest rates through the years.
Since the I bond was first introduced in 1998, the interest rate has ranged from a low of 0.00% to a high of over 13.9% depending on when it was issued and the six month period being tracked. Currently, the rate for new I Bonds is 6.89%.
I bond denominations
Electronic I bonds can be purchased in any amount from $25 to $10,000 per bond.
Paper I bonds (which are only purchasable with your IRS tax refund) are available in denominations of $50, $100, $200, $500, and $1,000 bonds and the amount of your total purchase can be any multiple of $50, from $50 to $5,000.
Quoted article excerpts are below:
From “How often can you buy I bonds”: While I bonds can be purchased digitally and in the old-fashioned paper format, the amounts you buy will vary, says Michael Schulman, chief investment officer at Running Point Capital Advisors.
“The electronic form of I bonds can be purchased at any amount from $25 to $10,000,” he says. “However, their paper counterpart is a little different. Paper I bonds are only available in multiples of $50.”
From “Can I buy I bonds as a gift for someone else?”: Michael Schulman, chief investment officer at Running Point Capital Advisors, cautions that while I bonds can be a great gift, they come with restrictions and limitations. “It’s a good idea to research and understand the terms and conditions before purchasing (them),” he says.
Disclosure: The opinions expressed are those of Running Point Capital Advisors, LLC (Running Point) and are subject to change without notice. The opinions referenced are as of the date of publication, may be modified due to changes in the market or economic conditions, and may not necessarily come to pass. Past performance is not indicative of future results. Forward-looking statements cannot be guaranteed. Running Point is an investment adviser registered with the U.S. Securities and Exchange Commission. Registration does not imply a certain level of skill or training. More information about Running Point’s investment advisory services and fees can be found in its Form ADV Part 2, which is available upon request. RP-23-17