Unexpectedly Intriguing!
11 January 2006

MyMoneyBlog had a very interesting post back in October 2005, which focused on the method one might use to predict what rate of return would be forthcoming when the I-bond Savings Bond rate would be adjusted later that month. Using the MyMoneyBlog method, the I-bond was predicted to have an annualized rate of return of 6.92%, plus or minus 0.2% depending upon where the fixed rate would be set (for a range between 6.72% and 7.13%.)

As it happened, the I-bond did have its fixed rate portion lowered from 1.2% to 1.0%, which in turn resulted in the I-bond's rate of return being set at the low end of MyMoneyBlog's prediction at an annualized rate of return of 6.73%.

We here at Political Calculations love it when a mathematical prediction pans out, so we've built a tool to do the math behind MyMoneyBlog's I-bond rate of return prediction method. All you need to do is to collect the following information and enter it in the table below, and the tool will take care of the rest:

Expected Range of I-Bond Fixed Rate

  • Low End of Expected Range for I-bond Rate of Return
  • High End of Expected Range for I-bond Rate of Return

Consumer Price Index for all Urban Consumers (CPI-U)

  • CPI-U for the most recent March or September
  • CPI-U for the next most recent of March (if the most recent CPI-U is available for September of the previous year) or September (if the most recent CPI-U is available for March of the same year).

I-Bond Data
Input Data Values
Fixed Rate (Low End) for I-Bond (%)
Fixed Rate (High End) for I-Bond (%)
CPI-U for Most Recent of March or September
CPI-U for Next Most Recent of March or September

Predicted I-Bond Rates of Return
Calculated Results Values
Low End of Range (%)
High End of Range (%)
Middle of Range (%)

The default values in the table are those from MyMoneyBlog's 14 October 2005 post, with the most recent CPI-U data from September 2005 and the next most recent CPI-U data from the next most recent March or September being from March 2005.

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About Political Calculations

Welcome to the blogosphere's toolchest! Here, unlike other blogs dedicated to analyzing current events, we create easy-to-use, simple tools to do the math related to them so you can get in on the action too! If you would like to learn more about these tools, or if you would like to contribute ideas to develop for this blog, please e-mail us at:

ironman at politicalcalculations.com

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