Cashing Series I Bond now or July?

[joesxm3]

I am planning to cash a 12/2021 Series I Bond to pay my property taxes rather than using some 5% money market fund or selling stock. The calculator shows 2.96% rate. I will lose 3 months interest as the early penalty.

Does it make sense to wait until July to cash it? Will I get some interest posted on July 1st that I would not get cashing tomorrow?

Does my general plan of ditching the low yielding Series I Bond to protect higher earning T Bills make sense? I realize I will give up some tax defered compounding but the extra 2% would seem to make up for that.

I also have a 1/2022 bond. Both seem to have a fixed rate of zero. This bond should recalculate interest on 7/1.

I should also add that I have very little in money market although I do have a weekly T Bill roll but in my IRA. So beyond taxes I could use the other bond for living expenses to allow rolling T Bills.

 

[jollystomper]

I-Bond interest is credited on the first day of the month and is not pro-rated. You will not get any of the July 1st interest if you sell now.

 

[QG67PK00]

If you wait until Monday you will get additional July interest.
For example if you have $10,000 worth of I-bonds,

Redeeming in June 2024:
Total Price Total Value
$10,000.00 $11,508.00

Redeeming in July 2024:
Total Price Total Value
$10,000.00 $11,544.00

The plan to ditch low yielding series I bonds in favor of t-bills makes sense.

 

[Koolau]

Off topic, mostly, but where do you sell your I-bond? Treasury direct? I'm looking for an easier way, but not sure if it exists (used to be able to sell them at National Banks.)

 

[joesxm3]

The bonds I am talking about were bought on treasury direct and will be sold there.

Bank of America told me a few months ago that they will cash paper bonds for me, but only up to 10 at a time IIR. I have not tried that yet.

 

[Gumby]

I-Bond interest is credited on the first day of the month and is not pro-rated. You will not get any of the July 1st interest if you sell now.

Technically, it is not "July interest", it is interest for the month of June that is credited on July 1st. You need to own the Ibond on the last day of a month to get the interest for that month. I know that is what you meant but thought this might help clear up any possible confusion.