Why are I bonds not a good idea?

I bonds may not be a good idea if you need to access your money within one year, require high liquidity, want to invest large sums of money, or seek higher returns than those offered by low-risk investments.

What is the downside of an I bond?

Cons: Rates are variable, a lockup period and early withdrawal penalty apply, and there's a limit to how much you can invest. Availability: I bonds can be purchased only through taxable accounts, not in IRAs or 401(k)s.

Why does Dave Ramsey not invest in bonds?

Dave Ramsey does not believe in investing in bonds because they are a debt instrument.

Why doesn't Warren Buffett invest in bonds?

With such a large, stable source of capital, Buffett has the luxury of taking a long-term view. He can invest in stocks that might underperform in the short term but should do well over decades. Bond investments simply can't match the long-term return potential.

Are I bonds still a good investment in 2025?

The current I-bond rate, valid for bonds issued November 1, 2025, through April 30, 2026, is 4.03%. That includes a fixed rate of 0.90%. To put that in context, the best high-yield savings accounts and the best CD rates are giving returns around 4.2%.

Dave Explains Why He Doesn't Recommend Bonds

How to turn $10,000 into $100,000 fast?

To turn $10k into $100k fast, focus on high-growth active strategies like e-commerce, flipping, or starting an online business (courses, digital products), as traditional investing takes years; these methods demand significant time, skill, and risk, but offer quicker scaling by leveraging your work and capital for exponential growth, though get-rich-quick schemes are scams, and realistic timelines often involve years even with aggressive strategies. 

When to cash out I bonds?

You can cash in (redeem) your I bond after 12 months.

Which bond is paying 7.5% interest?

Belong Limited 7.5% Social Bonds due 2030. The Belong Limited 7.5% Social Bonds due 2030 will pay a fixed rate of interest of 7.5% per annum, payable twice yearly on 7 January and 7 July of each year. The Bonds are expected to mature on 7 July 2030 with a final legal maturity on 7 July 2032.

How much is $1000 a month invested for 30 years?

Investing $1,000 per month for 30 years can grow to over $1 million, potentially reaching $1.4 million or more with an 8-10% average annual return (like the S&P 500), or around $800,000 at a 5% return, illustrating the powerful effect of compound interest over time, though actual results vary with performance and inflation. 

Do rich people invest in bonds?

High-net-worth individuals may invest in muni bonds because they provide steady income and tax benefits. For the ultra-wealthy, municipal bonds aren't just about earning interest.

Why doesn't Suze Orman like bond funds?

Financial guru Suze Orman says to say no to bond funds and yes to individual bonds. Her rationale is that if interest rates climb in future years—as is likely given today's very low levels—the prices of existing bonds with lower rates will fall.

Is Dave Ramsey a Trump supporter?

He has blamed politics for what he considers Americans' economic dependence, and has said presidents should do "as little as possible" about the economy. Ramsey supported Donald Trump in the 2024 United States presidential election.

What percent of Americans are 100% debt free?

Around 23% of Americans are debt free, according to the most recent data available from the Federal Reserve. That figure factors in every type of debt, from credit card balances and student loans to mortgages, car loans and more. The exact definition of debt free can vary, though, depending on whom you ask.

Where should I invest $1000 monthly for a higher return?

Mutual funds: Similar to an ETF, a mutual fund allows many people to pool their money to buy a variety of stocks, bonds, or other assets. It's typically managed by a team of professional investors. Index funds, ETFs, and mutual funds can all be great for easily diversifying a $1,000 investment.

Is it worth keeping ibonds?

I Bonds offer a secure way to protect savings from inflation while earning a modest return. They may be particularly appealing to those seeking safety and government backing, as well as tax advantages. However, purchase limits, early withdrawal penalties and a long maturity period may make them less attractive to some.

What is the 5% rule on bonds?

Q. What is the 5% tax deferred allowance? A. This is a rule in tax law which allows investors to withdraw up to 5% of their investment into a bond, each policy year, without incurring an immediate tax charge.

Can you live off interest of $1 million dollars?

Yes, you can live off the "interest" (investment returns) of $1 million, potentially generating $40,000 to $100,000+ annually depending on your investment mix and risk tolerance, but it requires careful management, accounting for inflation, taxes, healthcare, and lifestyle, as returns vary (e.g., conservative bonds vs. S&P 500 index funds). A common guideline is the 4% Rule, suggesting $40,000/year, but a diversified portfolio could yield more or less, with options like annuities offering guaranteed income streams. 

What is the 7 5 3 1 rule?

The 7-5-3-1 rule is a framework for long-term mutual fund investing through Systematic Investment Plans (SIPs), guiding investors to stay invested for at least 7 years, diversify across 5 categories, mentally prepare for 3 emotional phases (disappointment, irritation, panic), and increase their SIP amount by 1% (or more) annually for wealth growth. It promotes patience, risk management, and consistent investment increases for better returns, leveraging compounding. 

What bonds are paying 9% interest?

Government Savings Bonds (I Bonds) Are Paying A 9.62% Interest Rate. There are U.S. Government Savings Bonds, called “I Bonds”, that are currently paying a 9.62% interest rate as of August 2022, you can continue to buy the bonds at that interest rate until October 2022, and then the rate resets.

Is a treasury bond better than a CD?

Interest payments from CDs are taxed as income by state and federal governments, while interest income from Treasurys is exempt from state income tax. If you want to reduce your tax bill as well as earn income and preserve capital, a Treasury bond may make more sense when held in a taxable account.

Where can I get 10% return on investment?

Where can I get 10 percent return on investment?

• Invest in stocks for the short term. While you have a better chance of enjoying profit with long-term stock investments, some people make a significant amount of income through short-term investments in stocks. ...
• Real estate. ...
• Investing in fine art.

What does Warren Buffett say about bonds?

Buffett argues that stocks will continue to provide higher returns over the long run than bonds or cash. Invest the remaining 10% in short-term government bonds such as U.S. Treasury bills. This ensures liquidity (your ability to buy or sell with relative ease) while reducing your overall risk in market downturns.

Should I get rid of my I bonds?

You must hold your I bond for at least 12 months after purchase. If you cash in the I bond within five years of purchase, you lose the last three months of interest on the bond. I bond interest rates change every six months because the variable inflation rate is pegged to the Consumer Price Index (CPI).

What is the new I bond rate in 2026?

The composite rate for I bonds issued from November 2025 through April 2026 is 4.03%.