How To Buy I Bonds Without Using TreasuryDirect


Just two short years ago, nobody knew what the heck an “I bond” was. Despite the fact that they’ve been issued since 1998, only recently have they skyrocketed in popularity. This is because of our pesky new friend inflation.

As a 27-year-old, I’ve spent most of my adult life hearing about how “inflation has a target of 2% annually.” It was pretty much assumed that 2% inflation was a near matter of fact each year.

Fast forward to today, we now know how far that assumption was from the truth. We are now seeing inflation at a 40-year high, pushing north of 8% annually. This hasn’t been seen in nearly half a century!

This relates to I bonds because they’re essentially a financial instrument designed by the federal government to protect your buying power from inflation. Since it’s so high and expected to remain high, this has pushed many to invest in these Series I Savings Bonds.

However, the traditional method of purchasing these is a nightmare. This requires navigating the rather clucky TreasuryDirect website. I actually did it myself in a recent YouTube video. It took me about a half-hour to sign up, verify the account, and buy the I bonds.

I’ll show you a much easier way to buy I bonds using a banking app called Yotta*. But first, let’s learn more about this financial product.

*Ryan Scribner is an angel investor in Yotta.

I Bonds Explained

First, I bonds are issued by the federal government, so they’re as close to a “risk-free” asset as possible. When you purchase a treasury bond, you’re loaning money to the US government for a guaranteed rate of return. This payment depends on the type of bond purchased.

Before you buy I bonds, understand that:

  1. There is a minimum holding period of 12 months.
  2. You can hold them for a maximum of 30 years.
  3. After 12 months, you can sell them anytime.
  4. You forfeit three months of accrued interest if you sell them before five years.
  5. You can buy up to $10,000 per year per SSN.
  6. You can also buy an additional $5,000 worth with your tax refund.

So, for example, if you cashed in your bonds after 24 months of owning them, you would earn only the first 21 months of interest. All interest is paid when you cash out, meaning you don’t receive payments as you go.

What Is the I Bonds Current Interest Rate?

Series I bonds are designed to protect your money from inflation. This is accomplished through two rates: fixed rate and inflation rate.

The fixed rate stays the same for the entire life of the bond. The inflation rate adjusts every six months based on the consumer price index (CPI).

For bonds issued between May 1st, 2022 and October 31st, 2022, the current interest rate is a combined 9.62%. This is very high, based on the record inflation we’re currently seeing. This rate is expected to drop to around 6-7% in November 2022. To lock in the 9.62% rate for 6 months, you must purchase the bonds before October 28th, 2022.

As mentioned before, you have two options for purchasing I bonds:

  1. TreasuryDirect – It takes 30 minutes, and navigating the government website is challenging.
  2. Yotta – It takes 5 minutes using a cutting-edge, fintech banking app.

How To Buy I Bonds With Yotta

Check out my recent YouTube video, which explains how you can buy I bonds via Yotta:

Yotta is a fintech banking app that’s most well-known for its prize-linked savings account. Savers are rewarded with tickets into a weekly drawing based on how much money they deposit into the FDIC-insured savings account.

Recently, Yotta rolled out I Bond Buckets that allow you to buy I bonds without going through TreasuryDirect. Here are the steps:

1. Open A Yotta Account

Yotta is entirely free to download. And as long as you maintain a balance of at least $5, there are no fees.

To open an account with Yotta, you’ll need the following information:

  • Full Name
  • Email Address
  • Mailing Address
  • Date of Birth
  • Social Security Number (SSN)

The sign up process is simple and takes just minutes to complete. Be sure to use referral code RYAN or sign up with my referral link to get 100 bonus tickets!

2. Link Your Bank Account

You can link your bank account both securely and instantly using Plaid. At this point, you will receive your 100 bonus tickets (assuming you used referral code RYAN at sign up!)

Don’t deposit any money yet, unless you want to put it in your new savings account. For now, you’ll want to link your bank account so you can purchase I bonds in the next step.

3. Create An I Bonds Bucket

Yotta offers buckets which are essentially savings pods. You’ll need to create an I Bonds Bucket to buy them.

The app will prompt you with a notification on the home screen to complete these steps.

4. Purchase I Bonds

Once you have the I Bonds Bucket created, which is a one-time step, you can now purchase them whenever you want by visiting this bucket.

During this step, you’ll verify the “Deposit From” account, which should be whatever bank account you linked during Step 2.

Then, type in the dollar amount you’re looking to purchase.

Finally, you’ll review the “Unlock Date” and “Interest Rate” to be aware of both before confirming.

Lastly, click the purple Deposit Button, and you’re all set!

Check out this testimonial from Adam Moelis, Co-Founder of Yotta:

“We’re excited to offer the ability to purchase I bonds directly to consumers on our app, bypassing what consumers have described as an unnecessarily frustrating task of purchasing I bonds on the Treasury Direct website in the past. Feedback has been overwhelmingly positive from I Bond bucket users to date.”

The Bottom Line

I bonds are your best bet for protection against inflation, hands down.

Unlike the stock market, where there’s a risk of losing money, that’s not the case here. The United States Government backs your money. Even with the three month penalty, these are an excellent option for high-yield savings – assuming you can put the money away for a year.

Lastly, Yotta offers many other cool features above and beyond the I Bonds Bucket. Be sure to check out my full Yotta Review to learn more!

Read More: Prize-Linked Savings Accounts 101: How To Save And Win!