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Investments & Financial Planning

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  4. How is interest on Federal I bonds calculated ?

How is interest on Federal I bonds calculated ?

I Bonds have an annual interest rate that reflects the combined effects of a fixed rate and a semiannual inflation rate. They are an accrual-type security. Interest, if any, is added to the bond monthly and is paid when you cash the bond. I Bonds are sold at face value; i.e., you pay $50 for a $50 bond. Current Rate: 3.06% through April 30, 2012 Minimum purchase:$50 for a $50 I Bond when purchasing paper bond certificates. $25 for a $25 I bond when purchased electronically via TreasuryDirect

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