Interest bonds, also known as i bonds, are a fixed-income investment product issued by the United States Treasury. They are a type of savings bond that are backed by the full faith and credit of the United States government and are available to both individuals and institutions. Like other bonds, interest bonds are a way for investors to earn a fixed rate of return on their money over a period of time.
Interest bonds come in two varieties: fixed-rate and inflation-protected. Fixed-rate bonds have a fixed rate of interest that stays the same over the life of the bond, while inflation-protected bonds have an interest rate that adjusts with the inflation rate. Fixed-rate bonds usually have a higher rate of interest than inflation-protected bonds, but the rate will not increase with inflation.
investors can buy interest bonds directly from the Treasury Department or through a broker. Interest bonds can also be purchased through the TreasuryDirect online program. When buying interest bonds, investors should consider the maturity date, the interest rate, and the minimum purchase amount. investors can also buy interest bonds in denominations from $50 to $10,000.