May 10, 2022
Are I Bonds Recommended? | I Bonds Explained
In this episode, Chris Berry answers: Do you recommend I Bonds?
Estate Attorney and Advisor Chris Berry of Castle Wealth Group answers questions on retirement and estate planning every Wednesday at 1pm. Register via this link or give our office a call at 844-885-4200.
Castle Wealth Group and Christopher Berry help families with estate planning, elder law, retirement planning, and tax planning from their offices in Brighton, Ann Arbor, Livonia, Bloomfield Hills, and Novi.
Castle Wealth Group helps families with their legal, financial, and tax planning for their retirement and legacy.
With the use of legal structures like revocable living trusts, Castle Trusts (asset protection trusts), Chris Berry and Castle Wealth Group can help your family plan, protect, and preserve what is important through their Retirement and Legacy Blueprint Process.
For more info visit:
https://castlewealthlegal.com/home
https://michiganestateplanning.com/
Do you recommend iBonds? Welcome to Berry’s bites, please join our host attorney and financial advisor Chris Berry.
And the answer to this is, it depends i know it’s frustrating but as a fiduciary and attorney I always have to act in your best interest, so there’s no like perfect tool or anything out there big concern right now is inflation.
And they’re talking about inflation growing about six percent so if you have lazy money so this is money sitting at the bank or that’s liquid and safe you’re probably earning maybe one percent if you’re very lucky and if inflation is at six percent you’re losing money and you’re losing money slowly and safely so here’s where we have two tools to combat this one is a specific tool it’s kind of unique it’s called legacy excel and what it is it’s something that’s liquid but you’re looking at probably a five maybe eight percent rate of return.
Technically it’s an insurance product but you can access it after a year with no surrender charges or anything like that so it is a liquidity play and still getting a good rate of return this is really for people who are over 59 and a half so I gotta be 59 plus and then the other thing is now we have these iBonds these have been around for a while but right now i bond you can get a 7.2 rate of return on this so it resets bi-annually so the interest rate every six months is 3.6 percent should add up to 7.2 percent annually and it’s guaranteed which is awesome and it is state tax free not federally but state tax free which is pretty darn cool.
Now the downside of this is you can only put in ten thousand dollars per person so like if you have a hundred thousand dollars sitting in cash you can’t put it all into ibots but if you have say ten thousand dollars or twenty thousand dollars or if you’re married you’re not going to use the money for say a year then iBond makes a lot of sense now typically they’re on a five-year chassis if you do take it out prior to that then you’re gonna have to sacrifice a couple months of interest but still it’s gonna be better than having the money sitting in just savings so I myself I have some iBonds I purchased a couple weeks ago.
And we don’t do these just go to the government directly and you open up an account right there so as a tool I’m a fan of them if it makes sense I myself have some iBonds. Again what’s great about them is you’re getting a guaranteed 7.2 percent which is pretty unheard of and this just tells you that inflation is a big deal so I would start with iBonds if you have more than say ten or twenty thousand dollars you’re looking to invest in something safe and liquid then reach out to us and we might look at some of these other tools but yeah you have 20 000 sitting around iBond certainly may make sense if it’s something that you’re not going to touch for about a year or so because it’s a guaranteed 7 rate of return which again you don’t see those very often. Thank you.