1. What is the US Series I Bonds Calculator?

The US Series I Bonds Calculator estimates the value of Series I savings bonds with compounded interest. These bonds combine a fixed rate with an inflation-adjusted rate to protect against inflation.

2. How Does the Calculator Work?

The calculator uses the Series I Bonds formula:

Where:

• \( initial \) — Initial investment value in dollars
• \( fixed \) — Fixed interest rate (as decimal)
• \( inflation \) — Inflation rate (as decimal)
• \( composite \) — Combined composite rate
• The product is taken over all semi-annual periods

Explanation: The composite rate combines both fixed and inflation components, with interest compounding semi-annually.

3. Importance of Series I Bonds Calculation

Details: Accurate calculation of Series I Bonds value helps investors understand their inflation-protected returns and make informed investment decisions.

4. Using the Calculator

Tips: Enter initial investment in dollars, fixed and inflation rates as decimals (e.g., 0.05 for 5%), and number of semi-annual periods. All values must be positive.

5. Frequently Asked Questions (FAQ)

Q1: What are Series I Bonds?
A: Series I Bonds are U.S. government savings bonds that earn a combination of a fixed rate and an inflation-adjusted rate.

Q2: How often do interest rates change?
A: The inflation rate adjusts every six months, while the fixed rate is set when the bond is purchased and remains constant.

Q3: What is the minimum investment?
A: The minimum electronic purchase is $25, while paper bonds have a $50 minimum.

Q4: Are there any restrictions?
A: Yes, you must hold Series I Bonds for at least one year, and if redeemed within five years, you lose the last three months of interest.

Q5: How are these bonds taxed?
A: Federal income tax applies to the interest earned, but state and local taxes are exempt. Tax can be deferred until redemption.