You could consider selling them and investing the proceeds in TIPS, now mostly yielding 1.5-2% real. That's what I did last year, after taking a big tax hit on about $300K worth of low-yielding I-bonds (I was taxed on about $40-50K gains at 22%). I think it was a wise decision.Would you prefer to hold onto 0.00% & 0.40% fixed rate I-Bonds or absorb a tax hit to move them over Treasuries or Munis? We're in the 32% marginal bracket, selling them would generate a +$2K tax liability.
We cannot roll them over to 1.30% I-Bonds as we have already purchased our limit for this year and have gift boxes funded for 2025-2027. We took advantage of buying an extra $5K of I-Bonds per yer with our tax refund the last couple of years, but we cannot even do that anymore.
We could just hold onto them of course and enjoy the tax deferral until we need to spend them down.
Statistics: Posted by protagonist — Fri Sep 27, 2024 8:49 pm — Replies 7121 — Views 1693060