Eyebonds.Info Question
Eyebonds.Info Question
Hello,
I downloaded the excellent calculator to utilize as a tracking tool:
I notice the same phenomena occurring there as on this site:
http://eyebonds.info/ibonds/10000/ib_2021_03.html
The interest is not consistent from month to month even in the periods where no bonds are experiencing a changing composite rate on my portfolio, and in that link above, you can see that it is showing the $10,000 bond gaining $60 from Apr 1 to May 1, $60 from May 1 to June 1, but then $64 from June 1 to July 1, and then $60 again from July 1 to Aug 1.
Any ideas what's up with this?
I downloaded the excellent calculator to utilize as a tracking tool:
I notice the same phenomena occurring there as on this site:
http://eyebonds.info/ibonds/10000/ib_2021_03.html
The interest is not consistent from month to month even in the periods where no bonds are experiencing a changing composite rate on my portfolio, and in that link above, you can see that it is showing the $10,000 bond gaining $60 from Apr 1 to May 1, $60 from May 1 to June 1, but then $64 from June 1 to July 1, and then $60 again from July 1 to Aug 1.
Any ideas what's up with this?
Re: Eyebonds.Info Question
Possibly due to the wacky rounding that the treasury uses?
Re: Eyebonds.Info Question
It would if they need to pay out $12.5 each month. You’d have to overpay one month and underpay the next.
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Re: Eyebonds.Info Question
A $10,000 I Bond pays interest in increments of $4 because every penny on the $25 bond reference value is multiplied by 400.
The interest over the six-month period is calculated to exact values with respect to the compounded principal and effective interest rate, but rounded to the nearest $4 for redemption value purposes.
Doing the math along with eyebonds.info, for a March 2021 $10k I Bond, the monthly interest on compounded principal of $10,264 from March 1 to September 1 is $60.90.
March 1: $10,264
April 1: $10,324.90 -> rounds down to $10,324
May 1: $10,385.80 -> rounds down to $10,384
June 1: $10,446.70 -> rounds down to $10,444
July 1: $10,507.60 -> rounds up to $10,508
August 1: $10,568.50 -> rounds down to $10,568
September 1: $10,629.40 -> rounds down to $10,628
The interest over the six-month period is calculated to exact values with respect to the compounded principal and effective interest rate, but rounded to the nearest $4 for redemption value purposes.
Doing the math along with eyebonds.info, for a March 2021 $10k I Bond, the monthly interest on compounded principal of $10,264 from March 1 to September 1 is $60.90.
March 1: $10,264
April 1: $10,324.90 -> rounds down to $10,324
May 1: $10,385.80 -> rounds down to $10,384
June 1: $10,446.70 -> rounds down to $10,444
July 1: $10,507.60 -> rounds up to $10,508
August 1: $10,568.50 -> rounds down to $10,568
September 1: $10,629.40 -> rounds down to $10,628
Re: Eyebonds.Info Question
Incredible info, thank you very much! Also to Lee_WSP.BrokerageZelda wrote: ↑Mon Jan 17, 2022 3:01 pm A $10,000 I Bond pays interest in increments of $4 because every penny on the $25 bond reference value is multiplied by 400.
The interest over the six-month period is calculated to exact values with respect to the compounded principal and effective interest rate, but rounded to the nearest $4 for redemption value purposes.
Doing the math along with eyebonds.info, for a March 2021 $10k I Bond, the monthly interest on compounded principal of $10,264 from March 1 to September is $60.90.
March 1: $10,264
April 1: $10,324.90 -> rounds down to $10,324
May 1: $10,385.80 -> rounds down to $10,384
June 1: $10,446.70 -> rounds down to $10,444
July 1: $10,507.60 -> rounds up to $10,508
August 1: $10,568.50 -> rounds down to $10,568
September 1: $10,629.40 -> rounds down to $10,628
Interestingly, the calculator doesn't appear to be handling the $8K and $2K bonds as well with regards to the $4 incremental rounding. That is why there are cents values appearing in the portfolio value.
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Re: Eyebonds.Info Question
$8k bonds and $2k bonds have different step increments, because "a penny at $25" means $3.20 at $8k and it means 80 cents at $2k.Doc7 wrote: ↑Mon Jan 17, 2022 3:03 pmIncredible info, thank you very much! Also to Lee_WSP.BrokerageZelda wrote: ↑Mon Jan 17, 2022 3:01 pm A $10,000 I Bond pays interest in increments of $4 because every penny on the $25 bond reference value is multiplied by 400.
The interest over the six-month period is calculated to exact values with respect to the compounded principal and effective interest rate, but rounded to the nearest $4 for redemption value purposes.
Doing the math along with eyebonds.info, for a March 2021 $10k I Bond, the monthly interest on compounded principal of $10,264 from March 1 to September is $60.90.
March 1: $10,264
April 1: $10,324.90 -> rounds down to $10,324
May 1: $10,385.80 -> rounds down to $10,384
June 1: $10,446.70 -> rounds down to $10,444
July 1: $10,507.60 -> rounds up to $10,508
August 1: $10,568.50 -> rounds down to $10,568
September 1: $10,629.40 -> rounds down to $10,628
Interestingly, the calculator doesn't appear to be handling the $8K and $2K bonds as well with regards to the $4 incremental rounding. That is why there are cents values appearing in the portfolio value.
Re: Eyebonds.Info Question
Now I understand, this was explained in your first sentence in your first reply. Thanks again!BrokerageZelda wrote: ↑Mon Jan 17, 2022 3:06 pm$8k bonds and $2k bonds have different step increments, because "a penny at $25" means $3.20 at $8k and it means 80 cents at $2k.Doc7 wrote: ↑Mon Jan 17, 2022 3:03 pmIncredible info, thank you very much! Also to Lee_WSP.BrokerageZelda wrote: ↑Mon Jan 17, 2022 3:01 pm A $10,000 I Bond pays interest in increments of $4 because every penny on the $25 bond reference value is multiplied by 400.
The interest over the six-month period is calculated to exact values with respect to the compounded principal and effective interest rate, but rounded to the nearest $4 for redemption value purposes.
Doing the math along with eyebonds.info, for a March 2021 $10k I Bond, the monthly interest on compounded principal of $10,264 from March 1 to September is $60.90.
March 1: $10,264
April 1: $10,324.90 -> rounds down to $10,324
May 1: $10,385.80 -> rounds down to $10,384
June 1: $10,446.70 -> rounds down to $10,444
July 1: $10,507.60 -> rounds up to $10,508
August 1: $10,568.50 -> rounds down to $10,568
September 1: $10,629.40 -> rounds down to $10,628
Interestingly, the calculator doesn't appear to be handling the $8K and $2K bonds as well with regards to the $4 incremental rounding. That is why there are cents values appearing in the portfolio value.
This calculator is really something else. With a tool like this, I'll truly not understand the hesistancy of some to use IBonds simply due to the TD.Gov interface. You could conceivably not log in for 30 years and still be just as informed with a tool like this.
Re: Eyebonds.Info Question
It certainly adds a little bit more arbitrage into when to sell the bonds. Ideally you sell when the three lower payments are the last three months.
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Re: Eyebonds.Info Question
Yes, that's the smart way to redeem. Sometimes, when the rate drops to where someone decides to redeem, or when someone is considering redeeming for other reasons, it's smart to hold for three months at the low rate rather than forfeiting three month's interest at a good rate.
Best Regards - Mel |
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Re: Eyebonds.Info Question
True.Doc7 wrote: ↑Mon Jan 17, 2022 3:08 pmNow I understand, this was explained in your first sentence in your first reply. Thanks again!BrokerageZelda wrote: ↑Mon Jan 17, 2022 3:06 pm$8k bonds and $2k bonds have different step increments, because "a penny at $25" means $3.20 at $8k and it means 80 cents at $2k.Doc7 wrote: ↑Mon Jan 17, 2022 3:03 pmIncredible info, thank you very much! Also to Lee_WSP.BrokerageZelda wrote: ↑Mon Jan 17, 2022 3:01 pm A $10,000 I Bond pays interest in increments of $4 because every penny on the $25 bond reference value is multiplied by 400.
The interest over the six-month period is calculated to exact values with respect to the compounded principal and effective interest rate, but rounded to the nearest $4 for redemption value purposes.
Doing the math along with eyebonds.info, for a March 2021 $10k I Bond, the monthly interest on compounded principal of $10,264 from March 1 to September is $60.90.
March 1: $10,264
April 1: $10,324.90 -> rounds down to $10,324
May 1: $10,385.80 -> rounds down to $10,384
June 1: $10,446.70 -> rounds down to $10,444
July 1: $10,507.60 -> rounds up to $10,508
August 1: $10,568.50 -> rounds down to $10,568
September 1: $10,629.40 -> rounds down to $10,628
Interestingly, the calculator doesn't appear to be handling the $8K and $2K bonds as well with regards to the $4 incremental rounding. That is why there are cents values appearing in the portfolio value.
This calculator is really something else. With a tool like this, I'll truly not understand the hesistancy of some to use IBonds simply due to the TD.Gov interface. You could conceivably not log in for 30 years and still be just as informed with a tool like this.
Or, one could load and save their paper bond inventory in the savings bond calculator at TD and print a nice report monthly. Electronic bond holdings are also easily tracked, easy to download nice reports on them as well. You don't have to do any loading like the paper bonds, just download your report when you want to do so.
Downloading and printing my updated reports is a favorite task of mine on the first day of every month. No matter what the stock market might be doing, always nice to see something that is always increasing in value. Unlike our IRAs this year.
So far as the TD site, the only thing I have to remember is to not use my browser back button. TD isn't the prettiest site, but it works well for my limited visits: buying I-bonds and updating the value of the I-bonds.
Broken Man 1999
“If I cannot drink Bourbon and smoke cigars in Heaven then I shall not go." - Mark Twain
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Re: Eyebonds.Info Question
This is a nice looking calculator. You must have secret knowledge as it isn't listed as either a tool or a calculator on the siteuser9532 wrote: ↑Mon Jan 17, 2022 4:04 pm Another i bond calculator
https://eworkpaper.com/ibond.php
Re: Eyebonds.Info Question
I will link it to the calculator section. It is listed on the main page though.tonyclifton wrote: ↑Mon Jan 17, 2022 4:31 pmThis is a nice looking calculator. You must have secret knowledge as it isn't listed as either a tool or a calculator on the siteuser9532 wrote: ↑Mon Jan 17, 2022 4:04 pm Another i bond calculator
https://eworkpaper.com/ibond.php
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Re: Eyebonds.Info Question
Can someone please explain why my $10k July 2021 i bond shows $88 interest on the TD site, but twice that in both of the online calculators in this thread? It seemed wrong when I saw it at TD and I am sure there is a reason, but I am not having any luck finding it. My spouse's i bond shows the same thing.
Re: Eyebonds.Info Question
TreasuryDirect already has the early redemption penalty (before five years) of three months' interest deductedrustwood wrote: ↑Mon Jan 17, 2022 6:12 pm Can someone please explain why my $10k July 2021 i bond shows $88 interest on the TD site, but twice that in both of the online calculators in this thread? It seemed wrong when I saw it at TD and I am sure there is a reason, but I am not having any luck finding it. My spouse's i bond shows the same thing.
Re: Eyebonds.Info Question
Of course! I might have figured that out if I'd checked it last month or next month. Thank youMakefile wrote: ↑Mon Jan 17, 2022 6:23 pmTreasuryDirect already has the early redemption penalty (before five years) of three months' interest deductedrustwood wrote: ↑Mon Jan 17, 2022 6:12 pm Can someone please explain why my $10k July 2021 i bond shows $88 interest on the TD site, but twice that in both of the online calculators in this thread? It seemed wrong when I saw it at TD and I am sure there is a reason, but I am not having any luck finding it. My spouse's i bond shows the same thing.
Re: Eyebonds.Info Question
$10,444 is the correct value for June 2022 for a $10,000 I Bond with 0.00% Fixed Rate Purchased March 2021. However, $10,446.70 rounded to the nearest $4 would be $10,448 which is not the correct value. You're going at this the wrong way, BrokerageZelda. You're assuming that 1/6 of the entire six month's interest is added every month. This isn't how it's done. As is explained in the Wiki's How interest is calculated, the value after m months of each six month period grows by (1 + c / 2) ^ (m / 6) where c is the annual composite rate. For example, after one year a $25 bond will grow to $25.66 in March 2022. The value three months later in June 2022 is calculated as 26.1128 = 25.66 * (1 + 0.0712 / 2) ^ (3 / 6). This rounds to $26.11 which scales up to $10,444.BrokerageZelda wrote: ↑Mon Jan 17, 2022 3:01 pm ...
June 1: $10,446.70 -> rounds down to $10,444
...
Here is the complete calculation from March 2021 through September 2022:
Code: Select all
1 Face value 10,000
2 Fixed rate 0.00%
3 Inflation Rates
4 Nov 2020 0.84%
5 May 2021 1.77%
6 Nov 2021 3.56%
7 Inflat Compos 6 mo Value Roun Scaled Inte
8 Month Rate Rate Base Grows To ded X 400 rest
Code: Select all
9 Mar 2021 1 0.84% 1.68% 25.00 25.00 10,000
10 Apr 2021 2 0.84% 1.68% 25.00 25.0349 25.03 10,012 12
11 May 2021 3 0.84% 1.68% 25.00 25.0698 25.07 10,028 16
12 Jun 2021 4 0.84% 1.68% 25.00 25.1048 25.10 10,040 12
13 Jul 2021 5 0.84% 1.68% 25.00 25.1398 25.14 10,056 16
14 Aug 2021 6 0.84% 1.68% 25.00 25.1749 25.17 10,068 12
15 Sep 2021 1 1.77% 3.54% 25.21 25.2100 25.21 10,084 16
16 Oct 2021 2 1.77% 3.54% 25.21 25.2838 25.28 10,112 28
17 Nov 2021 3 1.77% 3.54% 25.21 25.3579 25.36 10,144 32
18 Dec 2021 4 1.77% 3.54% 25.21 25.4321 25.43 10,172 28
19 Jan 2022 5 1.77% 3.54% 25.21 25.5066 25.51 10,204 32
20 Feb 2022 6 1.77% 3.54% 25.21 25.5813 25.58 10,232 28
21 Mar 2022 1 3.56% 7.12% 25.66 25.6562 25.66 10,264 32
22 Apr 2022 2 3.56% 7.12% 25.66 25.8100 25.81 10,324 60
23 May 2022 3 3.56% 7.12% 25.66 25.9610 25.96 10,384 60
24 Jun 2022 4 3.56% 7.12% 25.66 26.1128 26.11 10,444 60 <===
25 Jul 2022 5 3.56% 7.12% 25.66 26.2654 26.27 10,508 64
26 Aug 2022 6 3.56% 7.12% 25.66 26.4190 26.42 10,568 60
27 Sep 2022 26.5735 26.57 10,628 60
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Re: Eyebonds.Info Question
Duly noted! Thanks for setting me straight.#Cruncher wrote: ↑Tue Jan 18, 2022 12:22 am$10,444 is the correct value for June 2022 for a $10,000 I Bond with 0.00% Fixed Rate Purchased March 2021. However, $10,446.70 rounded to the nearest $4 would be $10,448 which is not the correct value. You're going at this the wrong way, BrokerageZelda. You're assuming that 1/6 of the entire six month's interest is added every month. This isn't how it's done. As is explained in the Wiki's How interest is calculated, the value after m months of each six month period grows by (1 + c / 2) ^ (m / 6) where c is the annual composite rate. For example, after one year a $25 bond will grow to $25.66 in March 2022. The value three months later in June 2022 is calculated as 26.1128 = 25.66 * (1 + 0.0712 / 2) ^ (3 / 6). This rounds to $26.11 which scales up to $10,444.BrokerageZelda wrote: ↑Mon Jan 17, 2022 3:01 pm ...
June 1: $10,446.70 -> rounds down to $10,444
...
Here is the complete calculation from March 2021 through September 2022:Code: Select all
1 Face value 10,000 2 Fixed rate 0.00% 3 Inflation Rates 4 Nov 2020 0.84% 5 May 2021 1.77% 6 Nov 2021 3.56% 7 Inflat Compos 6 mo Value Roun Scaled Inte 8 Month Rate Rate Base Grows To ded X 400 rest
Code: Select all
9 Mar 2021 1 0.84% 1.68% 25.00 25.00 10,000 10 Apr 2021 2 0.84% 1.68% 25.00 25.0349 25.03 10,012 12 11 May 2021 3 0.84% 1.68% 25.00 25.0698 25.07 10,028 16 12 Jun 2021 4 0.84% 1.68% 25.00 25.1048 25.10 10,040 12 13 Jul 2021 5 0.84% 1.68% 25.00 25.1398 25.14 10,056 16 14 Aug 2021 6 0.84% 1.68% 25.00 25.1749 25.17 10,068 12 15 Sep 2021 1 1.77% 3.54% 25.21 25.2100 25.21 10,084 16 16 Oct 2021 2 1.77% 3.54% 25.21 25.2838 25.28 10,112 28 17 Nov 2021 3 1.77% 3.54% 25.21 25.3579 25.36 10,144 32 18 Dec 2021 4 1.77% 3.54% 25.21 25.4321 25.43 10,172 28 19 Jan 2022 5 1.77% 3.54% 25.21 25.5066 25.51 10,204 32 20 Feb 2022 6 1.77% 3.54% 25.21 25.5813 25.58 10,232 28 21 Mar 2022 1 3.56% 7.12% 25.66 25.6562 25.66 10,264 32 22 Apr 2022 2 3.56% 7.12% 25.66 25.8100 25.81 10,324 60 23 May 2022 3 3.56% 7.12% 25.66 25.9610 25.96 10,384 60 24 Jun 2022 4 3.56% 7.12% 25.66 26.1128 26.11 10,444 60 <=== 25 Jul 2022 5 3.56% 7.12% 25.66 26.2654 26.27 10,508 64 26 Aug 2022 6 3.56% 7.12% 25.66 26.4190 26.42 10,568 60 27 Sep 2022 26.5735 26.57 10,628 60
(Always something new to learn! )
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Re: Eyebonds.Info Question
Cruncher, thanks a million for this post - including your calculations and formulas! This was the real light-bulb, eye-opener for me. I had been struggling to match various online I bond calculators and this post was the bomb diggity.#Cruncher wrote: ↑Tue Jan 18, 2022 12:22 am $10,444 is the correct value for June 2022 for a $10,000 I Bond with 0.00% Fixed Rate Purchased March 2021. However, $10,446.70 rounded to the nearest $4 would be $10,448 which is not the correct value. You're going at this the wrong way, BrokerageZelda. You're assuming that 1/6 of the entire six month's interest is added every month. This isn't how it's done. As is explained in the Wiki's How interest is calculated, the value after m months of each six month period grows by (1 + c / 2) ^ (m / 6) where c is the annual composite rate. For example, after one year a $25 bond will grow to $25.66 in March 2022. The value three months later in June 2022 is calculated as 26.1128 = 25.66 * (1 + 0.0712 / 2) ^ (3 / 6). This rounds to $26.11 which scales up to $10,444.
Here is the complete calculation from March 2021 through September 2022:
...