Series I Savings Bonds Offer 4.26% Composite Rate for May-October 2026

Series I Savings Bonds, commonly known as I Bonds, are U.S. government-backed savings bonds designed to help preserve purchasing power during periods of inflation. For bonds issued between May 1, 2026, and Oct. 31, 2026, the composite rate is 4.26%, including a fixed rate of 0.90%. This rate is determined by combining a fixed rate that remains unchanged for the life of the bond with an inflation-adjusted component that is reset every six months.

What makes the fixed rate important is that it remains attached to the bond for as long as it earns interest. While today's I Bonds carry a 0.90% fixed rate, some of the earliest I Bonds issued when the program launched in 1998 locked in fixed rates of 3.40% above inflation. Investors who purchased those bonds received decades of inflation protection plus a substantial real return, making them among the most attractive I Bonds ever issued.

I Bonds earn interest monthly and compound semiannually. Investors may purchase up to $10,000 in electronic I Bonds per calendar year through TreasuryDirect, with purchases starting at just $25. While the bonds can be redeemed after 12 months, investors who cash out before five years lose the most recent three months of interest. Interest earned on I Bonds is exempt from state and local income taxes, and the bonds can continue earning interest for up to 30 years.

According to CurrencyNewsWire, a $10,000 investment in the original 1998 I Bond may have grown to roughly $35,000 today, while the same amount invested in the S&P 500 could be worth more than $80,000—but only one of those investments guaranteed inflation protection, never lost principal and let its owner sleep soundly through every major market crash of the past three decades.

I Bonds are backed by the full faith and credit of the U.S. government, making them a low-risk option for investors seeking to protect their savings from inflation. The current composite rate of 4.26% is particularly attractive compared to traditional savings accounts, which often offer lower yields. However, investors should be aware of the liquidity constraints: bonds cashed before five years forfeit the last three months of interest, and annual purchase limits apply.

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