Avoiding volatility with I-Bonds
For those looking to invest their money using the Straddle Trader Pro, the market can seem like a very dangerous place right now. Extremely volatile, the market and its offerings may not appeal to the new investor who wants to make sure their money increases in a safe place.
This is where the idea of savings bonds comes in. Specifically, I-bonds, which pay a variable interest rate and keep up with U.S. inflation. If you are looking for a low-risk place to store your money and have it work for you over time, these bonds can be your saving grace because they safeguard your money against inflation. Any money that is invested in an I-Bond is set at a fixed rate, earning you money while guaranteeing its purchasing power.
Aside from the safety against stock market volatility, one of the best perks of I-Bonds is that the tax on the interest is deferrable until the bond is cashed in. This option is perfect for those looking to save money for the future, either for themselves as a retirement fund or to finance an education or give as a gift for children’s futures. It is also easily attainable, as bonds are sold through the U.S. Treasury.
The one downside is for those who are looking to invest a lot of their money. I-bonds only allow the investor to purchase $5000 of bonds in a year. Additionally, this is not the best way to invest money if for the individual who can’t wait for long-term benefits. Penalties are issued for those who redeem bonds within the first 5 years of purchase.