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Protip: I Bonds for Emergency Funds & More : personalfinance

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I find myself mentioning I Bonds (US Series I Savings Bonds) a lot both here and in /r/portfolios[1] (I cross-posted this there as well[2] ) so I thought it worth making a little post about them. Here are some of the benefits:

They match or exceed inflation in their returns, at least before taxes, which is better than a lot of bond funds these days and without the interest rate risk

They can effectively expand your tax-deferred space since taxes do not come due until you cash them in – good for someone who wants to do long-term savings beyond their retirement allocation (and/or you can cash them in during low-income years to save on taxes)

They can be cashed in any time after a year (with a 3-month interest penalty – 5 years with no penalty) so if something better comes along you can always switch things up without taking a big hit

Related to the previous point: since they are liquid after one year, you can ultimately shift some emergency funds into I Bond form and beat CD and savings account rates (as long as you do the shift slowly so you always have enough liquid for emergencies without running into the 1-year minimum)

They aren’t for everyone, but they have a lot of neat features including the above – if anyone has critiques or something to add, please feel free!

Bonus Tip: I Bonds are limited to 10K per person per year, so for anyone who wants to and can buy more than that now is the time (you can buy 10K for 2013 before the year ends)

via Protip: I Bonds for Emergency Funds & More : personalfinance.


Born in 1964, business owner, from Woodbridge, VA, owns ExcitingAds! Inc. ( and blog ( He was born in Mirpurkhas, Sind, Pakistan. His elementary school was ST. Michael's Convent High School, Mirpurkhas, Sind, Pakistan. Graduated high school from ST. Bonaventure's Convent High School, Hyderabad, Sind, Pakistan. His pre-med college was S. A. L. Govt. College, Mirpurkas, Sind, Pakistan. Graduated from Liaquat University of Medical and Health Sciences, Jamshoro, Sind, Pakistan in 1990. Earned equivalency certification from Educational Commission for Foreign Medical Graduates, Philadelphia, PA in 1994.

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