Ask Terry Questions T bill or I bond

T bill or I bond

By Terry Savage on June 19, 2023 | Chicken Money

Have 50,000 in chicken money to invest. I bond or t bill? 3 or 6 month only . What profit can I make? Thanks Terry

Terry Says

First of all, you don’t make a PROFIT on “chicken money” investments like CDs, T-bills or Savings Bonds. You EARN INTEREST! (You don’t make a profit, but you never take a loss — except when the rates you earn are not high enough to offset inflation.)

I-bonds require you to hold them for 5 years, or take a penalty of 3 months loss of interest. T-bill mature in either 13 or 26 week timeframes, so you have greater liquidity.

I-bonds carry a fixed base rate, and a 6-month adjustment that reflects inflation. With T-bills you renew at maturity at whatever the rate is then — typically enough to offset inflation impact.

Please read the two articles on my home page — about T-bills and I-bonds so you can see all the differences and decide for yourself.



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