1. What is the Series I Savings Bond Calculator?

The Series I Savings Bond Calculator estimates the current value of US Treasury Series I savings bonds based on purchase amount, fixed rate, semiannual inflation rate, and holding period. It uses the official US Treasury calculation methodology.

2. How Does the Calculator Work?

The calculator uses the Series I Savings Bond formula:

Where:

• \( V \) — Current value (USD)
• \( P \) — Purchase amount (USD)
• \( \text{fixed} \) — Fixed annual rate (decimal)
• \( \text{inflation} \) — Semiannual inflation rate (decimal)
• \( y \) — Years held (years)

Explanation: The formula combines the fixed rate with twice the semiannual inflation rate plus their product, divided by 2, then compounds this rate semiannually over the holding period.

3. Importance of Series I Bond Valuation

Details: Series I bonds provide inflation protection, making accurate valuation essential for investment planning, tax reporting, and understanding real returns over time.

4. Using the Calculator

Tips: Enter 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 non-negative.

5. Frequently Asked Questions (FAQ)

Q1: What are Series I savings bonds?
A: US Treasury savings bonds that earn interest based on a combination of fixed rate and semiannual inflation rate.

Q2: How often do inflation rates change?
A: Inflation rates are adjusted every six months (May and November) based on CPI-U data.

Q3: What is the minimum holding period?
A: Series I bonds must be held for at least 1 year, with penalties for redemption within 5 years.

Q4: Are there purchase limits?
A: Yes, currently $10,000 per person per year electronically, plus $5,000 in paper bonds via tax refund.

Q5: How are Series I bonds taxed?
A: Federal income tax applies, but state and local taxes are exempt. Tax can be deferred until redemption.