I Bond Valuation Calculator

I Bond Valuation Formula:

\[ V = P \times (1 + \frac{composite}{2})^{2 \times y} \] \[ \text{where } composite = fixed + 2 \times inflation + fixed \times inflation \]

Purchase Amount (P):

USD

Fixed Rate:

decimal

Inflation Rate:

decimal

Years Held (y):

years

Current Value (V):

Unit Converter ▲

Unit Converter ▼

From:	To:

1. What is the I Bond Valuation Calculator?

The I Bond Valuation Calculator estimates the current value of Series I savings bonds based on the purchase amount, fixed rate, inflation rate, and years held. I Bonds are U.S. government savings bonds that earn interest based on both a fixed rate and an inflation rate.

2. How Does the Calculator Work?

The calculator uses the I Bond valuation formula:

\[ V = P \times (1 + \frac{composite}{2})^{2 \times y} \] \[ \text{where } composite = fixed + 2 \times inflation + fixed \times inflation \]

Where:

\( V \) — Current value (USD)
\( P \) — Purchase amount (USD)
\( composite \) — Composite rate (decimal)
\( fixed \) — Fixed rate (decimal)
\( inflation \) — Inflation rate (decimal)
\( y \) — Years held (years)

Explanation: The formula calculates the composite rate by combining the fixed rate with twice the inflation rate plus their product, then compounds this rate semi-annually over the holding period.

3. Importance of I Bond Valuation

Details: Accurate I Bond valuation helps investors track the growth of their savings bonds, understand the impact of inflation on their investment, and make informed decisions about holding or redeeming bonds.

4. Using the Calculator

Tips: Enter the purchase amount in USD, fixed rate and inflation rate as decimals (e.g., 0.025 for 2.5%), and years held. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What are I Bonds?
A: I Bonds are U.S. savings bonds that protect against inflation by combining a fixed rate with an inflation-adjusted rate that changes every six months.

Q2: How often do I Bond rates change?
A: The fixed rate remains constant for the life of the bond, while the inflation rate adjusts every six months based on the Consumer Price Index.

Q3: What are the current I Bond rates?
A: Current rates are announced by the Treasury Department each May and November. Check TreasuryDirect.gov for the latest rates.

Q4: Are there any restrictions on I Bonds?
A: I Bonds must be held for at least one year, and redeeming within five years results in a penalty of the last three months' interest.

Q5: How accurate is this calculator?
A: This calculator provides a close estimate, but actual bond values may vary slightly due to rounding methods used by the Treasury Department.