Savings I Bonds May 2022 Inflation Update: 9.62% Interest Rate!

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. does not include all card companies or all available card offers. All opinions expressed are the author’s alone.

May 2022 rate confirmed at 9.62%. Official press release. The variable inflation-indexed rate for I bonds bought from May 1, 2022 through October 31, 2022 will indeed be 9.62% as predicted. Every single I bond will earn this rate eventually for 6 months, depending on the initial purchase month. The fixed rate (real yield) is also 0% as predicted. Still a good deal.

See you again in mid-October for the next early prediction for November 2022.

Original post 4/12/22:

Inflation (and thus I Bonds) 🚀🚀🚀! Savings I Bonds are a unique, low-risk investment backed by the US Treasury that pay out a variable interest rate linked to inflation. With a holding period from 12 months to 30 years, you could own them as an alternative to bank certificates of deposit (they are liquid after 12 months) or bonds in your portfolio.

New inflation numbers were just announced at, which allows us to make an early prediction of the May 2022 savings bond rates a couple of weeks before the official announcement on the 1st. This also allows the opportunity to know exactly what a April 2022 savings bond purchase will yield over the next 12 months, instead of just 6 months. You can then compare this against a May 2022 purchase.

New inflation rate prediction. September 2021 CPI-U was 274.310. March 2022 CPI-U was 287.504, for a semi-annual increase of 4.81%. Using the official formula, the variable component of interest rate for the next 6 month cycle will be 9.62%. You add the fixed and variable rates to get the total interest rate. The fixed rate hasn’t been above 0.50% in over a decade, but if you have an older savings bond, your fixed rate may be up to 3.60%.

Tips on purchase and redemption. You can’t redeem until after 12 months of ownership, and any redemptions within 5 years incur an interest penalty of the last 3 months of interest. A simple “trick” with I-Bonds is that if you buy at the end of the month, you’ll still get all the interest for the entire month – same as if you bought it in the beginning of the month. It’s best to give yourself a few business days of buffer time. If you miss the cutoff, your effective purchase date will be bumped into the next month.

Buying in April 2022. If you buy before the end of April, the fixed rate portion of I-Bonds will be 0%. You will be guaranteed a total interest rate of 0.00 + 7.12 = 7.12% for the next 6 months. For the 6 months after that, the total rate will be 0.00 + 9.62 = 9.62%.

Let’s look at a worst-case scenario, where you hold for the minimum of one year and pay the 3-month interest penalty. If you theoretically buy on April 30th, 2022 and sell on April 1st, 2023, you’ll earn a ~6.51% annualized return for an 11-month holding period, for which the interest is also exempt from state income taxes. If you theoretically buy on April 30th, 2022 and sell on July 1, 2023, you’ll earn a ~7.17% annualized return for an 14-month holding period. Comparing with the best interest rates as of April 2022, you can see that this is much higher than a current top savings account rate or 12-month CD.

Buying in May 2022. If you buy in May 2022, you will get 9.62% plus a newly-set fixed rate for the first 6 months. The new fixed rate is officially unknown, but is loosely linked to the real yield of short-term TIPS, and is thus very, very, VERY likely to be 0%. Every six months after your purchase, your rate will adjust to your fixed rate (set at purchase) plus a variable rate based on inflation.

If you have an existing I-Bond, the rates reset every 6 months depending on your purchase month. Your bond rate = your specific fixed rate (based on purchase month, look it up here) + variable rate (total bond rate has a minimum floor of 0%). So if your fixed rate was 1%, you’ll be earning a 1.00 + 9.62 = 10.62% rate for six months.

Buy now or wait? Given that the current I bond rate is already much higher than the equivalent alternatives, I would personally buy in April to lock in the high rate for the longest possible time. Who knows what will happen on the next reset? I already purchased up to the limits first thing in January 2022. You are also getting a much better “deal” than with TIPS, as the fixed rate is currently negative with short-term TIPS.

Unique features. I have a separate post on reasons to own Series I Savings Bonds, including inflation protection, tax deferral, exemption from state income taxes, and educational tax benefits.

Over the years, I have accumulated a nice pile of I-Bonds and consider it part of the inflation-linked bond allocation inside my long-term investment portfolio. Right now, the inflation protection “insurance” is paying off with high yields and no principal risk.

Annual purchase limits. The annual purchase limit is now $10,000 in online I-bonds per Social Security Number. For a couple, that’s $20,000 per year. You can only buy online at, after making sure you’re okay with their security protocols and user-friendliness. You can also buy an additional $5,000 in paper I bonds using your tax refund with IRS Form 8888. If you have children, you may be able to buy additional savings bonds by using a minor’s Social Security Number. TreasuryDirect also allows trust accounts to purchase savings bonds.

Note: Opening a TreasuryDirect account can sometimes be a hassle as they may ask for a medallion signature guarantee which requires a visit to a physical bank or credit union and snail mail. Don’t expect to be able to open an account in 5 minutes on your phone.

Bottom line. Savings I bonds are a unique, low-risk investment that are linked to inflation and only available to individual investors. Right now, they promise to pay out a higher fixed rate above inflation than TIPS. You can only purchase them online at, with the exception of paper bonds via tax refund. For more background, see the rest of my posts on savings bonds.

[Image: 1950 Savings Bond poster from US Treasury – source]

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. does not include all card companies or all available card offers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned. is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.

User Generated Content Disclosure: Comments and/or responses are not provided or commissioned by any advertiser. Comments and/or responses have not been reviewed, approved or otherwise endorsed by any advertiser. It is not any advertiser's responsibility to ensure all posts and/or questions are answered.


  1. Thank you for the post and information Jonathan.

  2. I would recommend not buying any later than business hours on April 28th – if you buy on April 29th, I believe the purchase will be effective next business day (May 2nd).

  3. As a fun inflation hedge/mid-life crisis, I recently bought a new luxury car at $120k with a 84 month loan from PenFed at 2.39% interest. I had around 40k available for a downpayment, but I financed the entire car instead and used that 40k between 2021 and 2022 I bonds (Spouse and myself).
    Looks like a decent play thus far. Buying this new car appears to be the least of the worst financial decisions I have made in my life. Cheers!

  4. Are I bonds available through an ETF or mutual fund or only directly from the Treasury? Thanks!

  5. so if I buy now I get 7.12 for the next 6 months, but if I wait a month, I get 9.62 for the next 6 months? and after that they both will get set to the same rate? why would I buy now instead of waiting the month?

    • If you open in April, you’ll get 7.12% for 6 months, followed by 9.62% for 6 months. If you open in May, you’ll get 9.62% for 6 months, followed by an undetermined rate for the next 6 months.

      I look at it this way – 7.12% and 9.62% are both good rates for me. If the rate after 9.62% is low, then I’ll redeem after 15 months (7.12% for 6 months, 9.62% for 6 months, and 0% for 3 months because of the penalty). If the rate after 9.62% is high, then I’ll keep it for at least 21 months.

    • I’d rather get 7.12 guaranteed (and start earning a month earlier) than an unknown rate because I feel that the unknown rate is more likely than not to be below 7.12%.

    • If you buy in April you’ll get 7.12% APY only until the end of April. Then on May 1st it’ll switch to 9.62% APY through October 31st. New rates are effective each May 1st and November 1st.

  6. Jonathan,
    Is there a way to buy I-bonds in an IRA account?
    Or as Howard asked is there an ETF/Mutual fund that holds I-bonds that accomplishes the same thing that can be purchased through a brokerage IRA account?
    Thank you!

  7. Love I bonds. If only there were some recourse when the IRS just completely ignores Form 8888 and doesn’t give you the $5000 you request with your refund. Once your refund is issued in error, even if you manage to reach the IRS on the telephone, they tell you “Yeah it was our error but nothing we can do about it now. Good luck next year.” So maddening.

  8. Jen Jones says

    Thanks, great to know. I only have money to invest within an inherited IRA. What ETFs or mutual funds would allow me to invest in the new May I Bonds?

  9. From my understanding, the current 7.12% rate is an annual rate. These are compounded semi annual per the Treasury Direct website with the current semi annual rate of 3.56%. So to say you will get 7.12% for 6 months I believe is incorrect as it should be the semi annual inflation rate of 3.56%.

  10. Thanks for this post, it is helpful. For someone who is paying down debt on a home equity line of credit (HELOC), would you consider actually borrowing more against that HELOC to fund an I-bond purchase in April? The rate on the HELOC is variable and currently 3.0%, and will likely be going up as the Fed increases rates. I can understand it may be risky to borrow money to invest in stocks (margin loan), but it sounds like I-Bonds are essentially considered a risk-free investment. I expect the rate on the HELOC to rise from 3% to 5% by the end of the year, but that is still less than that 7.17% annualized return for a 14-month holding period.

  11. I was told you can gift ibonds for future years. Does anyone know if you can gift for yourself ie for next year 2023?

  12. If the May rate is 9.62% and the April rate is 7.12%. Is it better to buy in May than in April? Sorry, I am not clear on the advantage of buying in April and not waiting till May. Can you please clarify?

  13. What a good topic, I learn so much about I bond from you.
    I have a quick question.
    Would you guide my how to calculate “~6.51% annualized return for an 11-month holding period” from 7.12% interest Nov to April 2021 and 9.62% from May to Oct 2022.. I tried to do some math but I couldn’t match with your number.

  14. If you were buying the max – $10K – would it make sense to buy in segments (like $2500 x 4)? That way if you needed to cash out SOME funds you could keep the remainder accruing interest?

  15. opened an account in 5 minutes on my laptop

  16. I dont think Fred has the interest correct. There is a fix rate and variable rate. The fixed rate is 0 and the variable is 7.12 in April and 9.62 starting in May. It lasts for 6 months. The fixed rate stays with the bond for the life the bond is held. So for one month you will get the varaible rate of 7.12 % and next month you will get the 9.62 for the next 6 months. After that who knows.. It is the variable rate that changes. So there is not much difference between buying the bond in April or May it is only one month with the lower rate.

    • My explanation assumes the fixed rate stays at zero.

      You are incorrect in your understanding of how the variable rates are applied to your specific purchase. As Jonathan says in the post, “If you buy before the end of April…You will be guaranteed a total interest rate of 0.00 + 7.12 = 7.12% for the next 6 months. For the 6 months after that, the total rate will be 0.00 + 9.62 = 9.62%.”

      The key difference for most people is not the 7.12 vs. 9.62, but the blended rate you would receive over the first 12 months if you buy in April (which I calculate as 8.54 APY *without* penalty) vs. the blended rate you would receive if you buy in May, which is unknown. It could be much lower. It could of course be similar or even higher if the inflation announced in October is high again, but if you bought in April you’ll have the choice whether to hold the bond longer to take advantage, or redeem it and move your money elsewhere.

  17. Great info Jonathan !
    To keep it simple for a family of 4 all over the age of 18, I opened one account with TD. Created 3 additional “gift” accounts with their unique SSN. Then scheduled $10000 under each using my bank for 4/27/22. That would work right?
    Thanks !

  18. Could i do 5k here in April and then 5k in May to dollar cost if you will both rates?

  19. Related to Andy. I have created one account. I can buy $10,000 for myself and gift another $10,000 for my son who is over 18 with his own social security number. My wife can create her own account and buy herself $10,000. All accounts for TD will come from a single bank account. This is okay, correct? Thanks!

  20. Thanks for the post Jonathan. I still have a bunch of $$ locked into 2.5% and 3% 5-year CDs, but was able to cash out my no fee 11-month CD and drop it into an I Bond to make way more money

  21. I too was a little confused about the payment of interest on an I bond. From the comments above, it looks like its widespread. I even emailed Treasury Direct, and they did tell me what you have been saying.
    If you buy in January, and the rates change in May, you get the January rate for 6 months, until June.
    In July, you get the new rate that was posted in May. The new rate doesnt change your I bond rate, until the next 6 month anniversary of your purchase.
    From the purchase date, you get that rate for the next 6 months. THE NEXT 6 MONTHS.
    And , you might have several I bonds, bought during different months. They could be earning different rates.
    By the way, it is really nice of Treasury Direct to tell people the rate changes before hand. It allows you to know what you’ll be getting in interest for the next year, instead of for just 6 months. Really cool !!

  22. Can I buy ibond of 10k for each of my kid under 18? Is it advisable to buy for kids? What is the downside?

  23. With the way the markets have been and yields rising, it really looks like the Fixed Rate should be higher than 0%. It ought to be like 1% and then the Inflation Rate on top of that. Personally I think they are ripping people off if the keep the Fixed Rate at 0%

  24. Jonathan, if you own a CD at 3% for 6 yrs, would you break a CD and switch to IBond? Aso, what is a good percent of a portfolio to allocate to Ibonds, CDs?

  25. 9.62% ? Does that go up when the Fed raises rates like it did a few weeks ago?? Treasury website says it’s still 9.62?

    • No it doesn’t. New I Bond rates only come out at the beginning of May and the beginning of November.

  26. Great deal. Almost a 10% guarantee interest rate from the government.

  27. Jonathan,

    What are the advantages (except for tax savings) of owning an I bond over CDs? Wouldn’t it be worth waiting for the CDs to increase in rates and then locking that higher rate over I bonds that can always adjust rates?

    Thank you

Leave a Reply to joanne Cancel reply