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I have been trying to find information, better yet, someone's opinion on the government inflation indexed I bond. It seems like a very good investment but nobody has written anything about it.

I bonds are issued at face value, they earn a fixed rate of return and a semiannual inflation rate based on CPI-U. They earn interest for 30 years and interest is paid when the bond is redeemed. Earnings are exempt from state and local income taxes. Federal income taxes are deferred for 30 years or until the bond is redeemed.Right now I bonds earn 7.49%. And there is no risk of losing the principal as the bond is backed by the U.S. government. And there are no fund fees or broker commissions to pay. I bonds can be bought from Treasury Direct without paying any fees.

Am I wrong or is this a great investment? I haven't found any bond fund (or munis and treasury bills and notes) that yield 7.49%.

I'm looking forward to your opinion.

Mojopo
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Mojopo writes:

<<I have been trying to find information, better yet, someone's opinion on the government inflation indexed I bond. It seems like a very good investment but nobody has written anything about it. >>

See my article "Inflation-Protected Investments" at:
http://www.fool.com/retirement/retireeport/2000/retireeport000626.htm

Regards..Pixy
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Greetings mojopo,

Try:

http://socialize.morningstar.com/x.xs/XBbs/AllConv?forumId=F100000015

Search for message #6316. One of the best explanations on IBonds I've seen.

HTH
ES
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According to Suze/ Suzi ? Orman's web page, th 7.49% is good until the end of Oct only.

Emailed treasury and ask them why? Replied that the rate could go up or down come Nov. 1st.
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