Savings Bond investments still anemic in December

Wednesday, January 17th, 2007
Categorized as: Savings Bond investment rate

Investments in new Savings Bonds rose to an annual rate of $4.86 billion in December, the highest rate of investment since April 2006’s $7.22 billion.

However, for the first three months of the government’s fiscal year – October through December, the annual sales rate is just $3.87 billion – the lowest annual rate of new investment in years.

New investments in Series I bonds dropped to 44.9% of December’s total. This is a bit surprising since investors typically pick the series with the highest rate, which currently favors I bonds (4.52% to 3.60%).

Are investors starting to understand that the I bond rate changes after six months, while the EE bond rate is fixed for 20 years?

Readers of my book have access to an online graph showing the level of Savings Bond investments since Series I bonds were introduced in 1998. Check your Book Notes for the link.

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FDIC Insured Certificates of Deposit can pay 1 or 2% more than savings bonds when held for a similar length of time. See top CD Rates Below:

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June 1, 2010

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Tom Adams

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