The U.S. consumer price index, or CPI, rose by 8.5% in March, its highest inflation reading since 1981. For Americans concerned about falling stock prices and soaring inflation, U.S. I bonds may be an increasingly attractive option.
The U.S. Department of the Treasury recently announced that I bonds will pay a 9.62% interest rate through October 2022, their highest yield since they were first introduced back in 1998. These I bonds are protected against inflation and backed by the U.S. government, making them essentially risk-free investments – the only way these investments fail is if Uncle Sam doesn’t pay his debts. A practically risk-free 9.62% yield may seem too good to be true, but there are several things investors should understand before going all-in on I bonds…
This post originally appeared at U.S. News & World Report.