I decided that I would purchase some I-Bonds for my niece for her college investments with $1000 of her funds. Currently I’m investing her money in Japanese antiques (and where I have most of my money invested), but since I usually turn the items I purchase over fairly quickly, I don’t see a need for more than $1000 to start off. Most of the items I invest in run under $200 so I should be able to do fine for her with the $1000. So instead of having that money sit in my bank account here (with the wildly high interest rates I can earn as mentioned in the previous post), it seems reasonable to place some of that money in the I-Bonds for now.
Opening the Treasury Direct account was a breeze. It took all of 10 minutes and was basic and straight forward. The hardest part (and what took the most time) was trying to figure out my favorite movie and my dream vacation for security questions.
I will opt to open in October for her to get the guaranteed 4.8% and whatever the announced new rate will be in November. Since there is such a wide opinion on whether the base rate will increase or fall, I’m going on my gut that says that it will either stay the same or fall. I just don’t see the treasury offering a 7%+ bond. If I’m wrong and the base rate does increase, then I’ll consider purchasing some more in November.