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Which are a better investment, I bonds or E bonds? Are bonds the best way to go as a 32 year old.?


Which are a better investment, I bonds or E bonds? Are bonds the best way to go as a 32 year old.?

It all depends upon what you are trying to accomplish. If you are trying to put money away for something that will happen in under 5 years it is advisable to keep your money in something that presents no risk to your principal such as I or EE bonds. If your goal is farther out than 5 years these fixed income investments are not the best choice. I say this because now you have to factor in inflation. When you factor inflation into the picture I and EE bonds are barely keeping up over time. For a period of over 5 years you have to give yourself a chance by investing in something that at least has the potential of outpacing inflation. Specifically, I am referring to stock based mutual funds. Don't believe the uninformed people who equate investing to gambling or playing the lottery. There has not been a 10 year period of time when the stock market as tracked by the S & P 500, Dow Industrial, or the Nasdaq has not outpaced the rate of inflation. I bonds were created as an improvement over EE bonds in that they are designed to keep up with inflation but not outpace it. The reason inflation has to be accounted for is because this directly impacts the value of your money. If you make 4% on an investment but inflation is at 4.5% you have actually lost .5% in buying power with your money. The longer you are in this deficit position, the worse the situation gets. I would strongly recommend index mutual funds as the base of your investment portfolio. Index funds are designed to track the markets rather than outpace them. They are very well diversified, tax efficient, and relatively low in expenses. Pretty much every brokerage firm offers index funds. The company that was mentioned earlier, Vanguard, does have the reputation of being one of the least expensive in the industry. Good luck. I hope that this is helpful.

I bonds or Treasury notes

an i bond should always out perform a ee bond over an extend period of time.stocks are like lottery tickets,think mutual funds for captial growth but the best investment is real estate.bonds are smart place to sit your money and protect it but DO NOT buy a bond fund you will regret it.

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