F---ing I-Bonds

[Anonymous]

I bought a bunch at the 3.54% rate so another 6 months at 7% is fantastic. I'm sure it will go down to 0% next cycle however.

[Anonymous]

Anonymous wrote:I bought a bunch at the 3.54% rate so another 6 months at 7% is fantastic. I'm sure it will go down to 0% next cycle however.

It’s based on the CPI so unless inflation goes to zero the rate won’t either.

[Anonymous]

Re question on minor accounts here is some info on how to set up

https://www.treasurydirect.gov/indiv/help/tdhelp/howdoi.htm#openminor

And

https://www.treasurydirect.gov/indiv/help/tdhelp/help_ug_141-MDAccountEstabMinor.htm

[Anonymous]

Anonymous wrote:I bought a bunch at the 3.54% rate so another 6 months at 7% is fantastic. I'm sure it will go down to 0% next cycle however.

It changes to the new rate though based on the month you bought it. It's complicated.

[Anonymous]

It took me 10 minutes to set up my account and make the initial deposit. I will add to it in January. It's a fraction of our portfolio but is a good return on a no risk investment. Eventually these things add up.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The catch is that these are measly returns. 7% on 10k? Sure, 700 is nice, but no one is going to be getting rich off these things.

You forgot a very important word - "guaranteed" return.

No one is suggesting an I-bond be the primary vehicle for wealth creation. But they can be an incredibly helpful part of it.

Yep, especially since most 2 parent 2 kid households could buy 80k in the next 6 months which would bring it up to 5.6k. But more importantly, that safe anchor frees up the ability to take risks elsewhere with investments.

Is this because of the $10,000 calendar year limit? So you and your spouse could each buy $20K now and $20K on Jan 1st and then you could also do the same for each of your children with a minor account?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The catch is that these are measly returns. 7% on 10k? Sure, 700 is nice, but no one is going to be getting rich off these things.

You forgot a very important word - "guaranteed" return.

No one is suggesting an I-bond be the primary vehicle for wealth creation. But they can be an incredibly helpful part of it.

Yep, especially since most 2 parent 2 kid households could buy 80k in the next 6 months which would bring it up to 5.6k. But more importantly, that safe anchor frees up the ability to take risks elsewhere with investments.

Is this because of the $10,000 calendar year limit? So you and your spouse could each buy $20K now and $20K on Jan 1st and then you could also do the same for each of your children with a minor account?

Yes.

[Anonymous]

I'm convinced. Thanks for the heads up.

[Anonymous]

For those of you doing accounts for the kids, is it still your money, or are you basically ceding $20k to your kids?

[Anonymous]

Anonymous wrote:For those of you doing accounts for the kids, is it still your money, or are you basically ceding $20k to your kids?

Legally, it's ceding money to them although you control it as long as they are minors.

If you don't want to actually give them money, just don't tell them. You create the account in their name, control the userid/login, etc and when it's time to move the money over to yourself, just do it (as long as you stay within the gift tax limits). They would be none the wiser.

[Anonymous]

Anonymous wrote:

Anonymous wrote:For those of you doing accounts for the kids, is it still your money, or are you basically ceding $20k to your kids?

Legally, it's ceding money to them although you control it as long as they are minors.

If you don't want to actually give them money, just don't tell them. You create the account in their name, control the userid/login, etc and when it's time to move the money over to yourself, just do it (as long as you stay within the gift tax limits). They would be none the wiser.

That would be stealing from your kids. If you opened the account in their name, it’s theirs and you are the custodian with a legal responsibility to manage it for them. You could use it for their benefit, like school or camp, but you can’t just buy yourself a car with your kids’ money.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:For those of you doing accounts for the kids, is it still your money, or are you basically ceding $20k to your kids?

Legally, it's ceding money to them although you control it as long as they are minors.

If you don't want to actually give them money, just don't tell them. You create the account in their name, control the userid/login, etc and when it's time to move the money over to yourself, just do it (as long as you stay within the gift tax limits). They would be none the wiser.

That would be stealing from your kids. If you opened the account in their name, it’s theirs and you are the custodian with a legal responsibility to manage it for them. You could use it for their benefit, like school or camp, but you can’t just buy yourself a car with your kids’ money.

Not when they are minors and you are their parents and you funded the account.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:For those of you doing accounts for the kids, is it still your money, or are you basically ceding $20k to your kids?

Legally, it's ceding money to them although you control it as long as they are minors.

If you don't want to actually give them money, just don't tell them. You create the account in their name, control the userid/login, etc and when it's time to move the money over to yourself, just do it (as long as you stay within the gift tax limits). They would be none the wiser.

That would be stealing from your kids. If you opened the account in their name, it’s theirs and you are the custodian with a legal responsibility to manage it for them. You could use it for their benefit, like school or camp, but you can’t just buy yourself a car with your kids’ money.

Not when they are minors and you are their parents and you funded the account.

You are wrong about this but maybe more importantly savings bonds are registered securities which means you need the gov’t’s approval to transfer them to anyone so it may not be as easy as you think to move money around.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:For those of you doing accounts for the kids, is it still your money, or are you basically ceding $20k to your kids?

Legally, it's ceding money to them although you control it as long as they are minors.

If you don't want to actually give them money, just don't tell them. You create the account in their name, control the userid/login, etc and when it's time to move the money over to yourself, just do it (as long as you stay within the gift tax limits). They would be none the wiser.

That would be stealing from your kids. If you opened the account in their name, it’s theirs and you are the custodian with a legal responsibility to manage it for them. You could use it for their benefit, like school or camp, but you can’t just buy yourself a car with your kids’ money.

Not when they are minors and you are their parents and you funded the account.

No, once you gifted the money to them it’s theirs and you are a fiduciary with the duty to spend it for their benefit. They could sue you when they reach 18 for breach of fiduciary duty or you could be criminally prosecuted for theft.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:For those of you doing accounts for the kids, is it still your money, or are you basically ceding $20k to your kids?

Legally, it's ceding money to them although you control it as long as they are minors.

If you don't want to actually give them money, just don't tell them. You create the account in their name, control the userid/login, etc and when it's time to move the money over to yourself, just do it (as long as you stay within the gift tax limits). They would be none the wiser.

That would be stealing from your kids. If you opened the account in their name, it’s theirs and you are the custodian with a legal responsibility to manage it for them. You could use it for their benefit, like school or camp, but you can’t just buy yourself a car with your kids’ money.

Not when they are minors and you are their parents and you funded the account.

You are wrong about this but maybe more importantly savings bonds are registered securities which means you need the gov’t’s approval to transfer them to anyone so it may not be as easy as you think to move money around.

You can't transfer I bonds, but you can sell them and transfer the money. No one cares about that.