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Snowbird
Snowbird

Reminder – due to the Memorial Day holiday, today is the last day to purchase for May.

John
John

Overpaid taxes and got a 5K paper bond in the mail last wekk. The bond does not have my full name. It also has a “OR” and has my wife’s name. Both names are listed in short form. Something like this – J MILLER “OR” K MILLER

I want to deposit (or convert) this in to my TreasuryDirect account. I created a conversion list account and now trying to “Create my registration list” but have a couple of questions

– Should I enter the names in short form as shown on the paper bonds? Or should I enter our full name?
– Then for “Type”, should I select – “OR (Co-Owner)” or should I select “POD (Payable On Death, Beneficiary)”? When I purchased gift for my wife from my account last month, I used POD. So not sure if I should choose OR or POD for this. The paper bond does not have POD. Only has OR followed by my wife’s name

Would appreciate the input! Thank you!

mangorunner
mangorunner

Some very good references:

How To Deposit Paper I-Bonds to TreasuryDirect Online Account
https://thefinancebuff.com/how-to-deposit-paper-i-bonds-to-online-account.html

Going Paperless
https://humbledollar.com/2021/11/going-paperless/

(Good information in the Comments sections at bottom, too.)

MC
MC

I would use full names, and OR (co-owner) is correct. What was your timeline as far as filing date/bond issue month?

Tipswatch put together a guide walking through the conversion process you might find helpful:
https://tipswatch.com/2022/05/08/ready-to-convert-paper-i-bonds-into-electronic-form-heres-a-step-by-step-guide/

John
John

Thanks. Filed on April 18 (deadline). Issued on 5/5 so month is May. Missed the 7.2% window though. But at least IRS didnt delay the refund too long

MC
MC

April CPI numbers were released today. Inflation is running higher than expected, but the 12 month change is down slightly from 8.5% to 8.3%. As far as the I-bond, April’s monthly change was 0.56%, contributing 1.12% to the expected November rate.

gli
gli
Other Kevin
Other Kevin

Came here for this breakdown, thanks.

Drew$$
Drew$$

What is the expected rate for November?

MC
MC

we’ll get the first clue next week when april cpi data is released. most economists think we are at or nearing peak inflation, but we probably won’t know how the fed rate increases affect the fixed rate until its officially released.

Mochi
Mochi

First time bought I bonds here on April 20th at 7.12%, saw they said interest is paid every month, I login in I did’t see interest paid in my account. wonder if need to wait till end of May. Not sure if I have actually made the purchase smh… That UI design is tbh trash

Edit: it’s three months after purchase, because if you sell within 5 years you lose the first three months of interests

Celia
Celia

As you likely figured out, the total balance will not change until the fourth month when you’ll see April’s interest. The most recent three months’ interest will not be reflected in your balance until the 5 year penalty has passed.

But not sure why you say if you have actually made the purchase. The original purchase should be there, just not the interest reflected.

Snowbird
Snowbird

As long as you see the bond included in your balance, you made the purchase. As long as you bought in April, you’ll start seeing interest on August 1, with interest showing three months behind. You’ll lose the last three months interest if you cash in before 5 years, not the first three.

boo
boo

is non resident aliens not able to register without verifying by sending doc to their address? anyone

Al Z
Al Z

I bought $10k of I-bonds in December. Its been 5-months. Why is it only worth $10,116? That’s not 7.12%/2

IXO
IXO

AFAIK, the 7.12% is annualized. So a year after you bought it, the value should be $10,712.

MC
MC

nope, read the post again

Fred
Fred

The reason is the three month penalty. It’s showing you 2 months of interest. I purchased $10K in January and mine is $10,060. The interest for any given month is a little funky (I guess you go $56 for March and $60 for April); I don’t have an explanation for that.

mangorunner
mangorunner

All I-bond interest is referenced to a $25 bond. A $10k I-bond pays interest in $4 increments because every penny on the $25-bond reference-value is multiplied by 400. More discussion here (including how you can game the system on rounding when you get ready to cash):
https://www.bogleheads.org/forum/viewtopic.php?p=6456170#p6456170

Fred
Fred

Awesome, thank you. The calculators on that page also helped me figure out I was calculating the penalty from the wrong end.

MC
MC

first of all, you’ve only had it 5 months, why would you think you’ve earned 6 months of interest?
second, as has been stated in numerous places you currently suffer a 3 month penalty.
out of curiosity, do you often invest in things you don’t have basic understandings of? if so, someone has an NFT of a bridge they want to sell you, lol

RG
RG

MC, we’re all learning here. Please don’t mock others who are trying to understand. Most investments aren’t fully understood until the investor takes the plunge. I’m glad you are smart. And no thank you to the NFT. lol.

MC
MC

If someone has difficulty understanding the finer points of I bonds or navigating the arcane TD website, I’m happy to help. But questions like this, and others that have been noted, just smack of laziness and entitlement. If you can’t be bothered to do even the basic due diligence to understand an investment, then you probably shouldn’t be investing in it…otherwise, hopefully you don’t end up like that robinhood kid

Alex
Alex

Hey, guys, my paper bonds have just arrived (the ones I got for my tax refund). The issue date on the bonds states NPC-KC 04-28-22. Does this mean I am getting the 7.12% rate for 6 months and then the 9.62% rate for the following 6 months? Thanks!

MC
MC

yep

IXO
IXO
IXO
IXO

I assume the rate changes a couple of times a year. How an we check what the rate is going forward?

Bill
Bill