I Bond Calculator

Enter your amount and holding period; the current 4.26% composite rate fills in automatically, or use your own. You'll see the rate built from Treasury's formula, your redemption value with any 3-month penalty priced, and the after-state-tax race against your best CD.

Data reviewed: July 2026. Figures here come from published sources and change over time. How we verify

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How an I-bond's rate is actually built

A Series I savings bond earns a composite rate made from two parts. The fixed rate is set the day you buy and never changes for the bond's 30-year life: it is your real, above-inflation return, and it is the number the buying decision should hinge on. The inflation rate resets every six months from CPI, which is the whole point of the product: your savings keep pace with prices, mechanically, without you predicting anything. For bonds bought May through October 2026 the fixed rate is 0.90% and the semiannual inflation rate is 1.67%, making a 4.26% composite.

The fine print that matters: you cannot touch the money at all for 12 months; redeeming before 5 years forfeits the last 3 months of interest; interest is federal-taxable (deferrable until you cash out) but never state-taxable, an exemption I-bonds share with Treasury bills and notes; and the composite can never go below zero, so deflation cannot eat your principal.

The formula

Composite = Fixed + 2 × Semiannual inflation + (Fixed × Semiannual inflation)
Value = Amount × (1 + Composite ÷ 2)2 × years

This is Treasury's own published formula, and it is why the composite (4.26%) is a touch more than fixed plus double inflation: the cross-term pays inflation on the fixed portion too. The projection holds the inflation component at today's level, which is a stated simplification: nobody knows future CPI, least of all a calculator.

Worked example

A full $10,000 purchase at the current rates (0.90% fixed, 1.67% semiannual inflation: 4.26% composite), held 5 years: it compounds semiannually to $12,346.20, an effective 4.31% a year, with no penalty at the 5-year mark.

Cash out at 3 years instead and the last 3 months of interest are forfeited: about $118.96, leaving $11,229.06. And the tax race: a 4.30% CD in a state with a 6% income tax keeps only 4.04% after the state's cut, while the I-bond's 4.26% is untouched: equivalent to a fully taxable 4.53%. The lower sticker rate wins.

When I-bonds win, and when they do not

I-bonds are insurance against inflation, not a yield play. When inflation runs hot, their composite chases it automatically while CD holders watch their locked rates fall behind in real terms; when inflation cools, the composite sags with it and a good locked CD or Treasury can pull ahead. That is why the fixed rate deserves most of your attention when buying: it is the part that persists after every inflation cycle washes through, and periods with a meaningful fixed rate (like today's 0.90%) are historically the better vintages to buy.

The practical playbook: the money must be spare for at least a year (the lockup has no exceptions), the best holding periods are either 5+ years or a deliberate shorter plan that accepts the 3-month penalty (which this page prices rather than hides), and the $10,000 per-person annual limit means a couple can shelter $20,000 a year, with purchases made late in a month earning from the 1st of that month regardless. For the same state-tax-free yield without purchase limits or lockups, Treasury bills are the sibling product: compare their yield to the I-bond composite directly, no adjustment needed, and let the inflation-protection question break the tie.

Your next step: the only store there is

I bonds are sold in exactly one place: TreasuryDirect.gov, the US Treasury's own site, up to $10,000 per person per calendar year. No bank sells them, no brokerage sells them, and no one collects a commission on them, including us, which makes this the easiest recommendation on the site: there is nobody to be conflicted for. Open the account, link your bank, buy the bond, and note the twelve-month lockup this page already prices before you commit money you might need sooner.

Sources

Where the numbers on this page come from. We go to the body that publishes the figure, not to another calculator. Figures on this page were checked against these sources in July 2026. See how we verify.

Frequently asked questions

What is the current I bond rate?

Bonds bought May through October 2026 earn a 4.26% composite rate: a 0.90% fixed rate that lasts the bond's whole 30-year life, plus a 1.67% semiannual inflation rate that resets every six months. Treasury announces new rates each May 1 and November 1.

How is the I bond composite rate calculated?

Treasury's formula is fixed rate + 2 times the semiannual inflation rate + the product of the two. With 0.90% fixed and 1.67% inflation that is 0.90 + 3.34 + 0.02, which rounds to 4.26%. The cross-term exists so the fixed portion earns inflation too, and the composite can never go below zero.

When can I cash out an I bond?

Not at all for the first 12 months, with no exceptions short of a federally declared disaster. From 1 to 5 years, redeeming forfeits the last 3 months of interest, which this calculator prices instead of hiding. After 5 years there is no penalty, and the bond keeps earning for up to 30 years.

How much can I put in I bonds per year?

$10,000 per person per calendar year, electronically through TreasuryDirect; trusts and businesses get their own $10,000. The old option to buy an extra $5,000 in paper bonds with a tax refund ended in January 2025, so electronic is now the only route. A couple can shelter $20,000 a year between them.

Are I bonds taxed?

Federal income tax applies to the interest, but you may defer it until redemption (or report annually if that suits a low-bracket year). State and local income taxes never apply, an exemption shared with Treasury bills and notes, which is why a fair comparison against a CD must first take state tax out of the CD's rate.

Are I bonds better than a CD right now?

Run your own numbers in the calculator, and mind the state tax: in the worked example a 4.30% CD in a 6% state keeps 4.04% while the I-bond's 4.26% is untouched. The structural difference matters more than the decimal: the CD's rate is locked and the I-bond's floats with inflation, so the I-bond is insurance against inflation more than a yield play.

What does the I bond fixed rate mean and why does it matter most?

It is the permanent, above-inflation part of your return, locked on the day you buy for the bond's entire life. Inflation spikes and lulls wash through the other component every six months, but the fixed rate persists, which is why vintages with a meaningful fixed rate, like today's 0.90%, are the historically better ones to buy.

Do I bonds protect against deflation?

Yes, asymmetrically. The composite rate has a floor at zero, so falling prices can pause your interest but can never shrink your principal or previously earned interest. TIPS, the marketable cousin, do not share that floor on their principal, which is one of the quiet differences between the two.

Can I use I bonds for college tax-free?

Sometimes. Interest can be federal-tax-free when the bond owner pays qualified higher-education costs in the redemption year, but the exclusion has income phase-outs and ownership rules (the bond must be in a parent's name, not the child's). For dedicated college saving, compare it against a 529 before counting on the exclusion.

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