Highest I-Bond Fixed Rate In 20 Years (November), Treasuries Or Higher-Yielding Annuities?

Summary

Inflation and Market Backdrop

• September 2026 CPI inflation was 3.7% year over year; core CPI was 2.6%.
• Energy prices rose 5.2% in September and 20.4% over 12 months. Gasoline was up 34.2% year over year. The presenter attributed much of the inflation pressure to oil.
• Oil prices rose about 8% during the week discussed. The presenter cautioned that continued Middle East tensions could keep inflation elevated.
• The S&P 500 fell 2% and the Nasdaq 100 fell 5.6% that week. The presenter suggested investors may have moved into Treasuries amid caution about stocks, pushing Treasury prices up and yields down. It was uncertain whether the equity decline was a temporary correction or a turn in the AI-led bull market.

November 2026 I Bond Projection

• The presenter projected an I Bond fixed rate of 1.4%, compared with the current 0.9%. The presenter said 1.4% was last set in 2006, 20 years earlier.
• The projected six-month inflation rate is 4.08%, up from the current 3.34%. Adding the estimated 0.03% fixed-rate inflation adjustment (“bump”) gives a projected combined I Bond rate of 5.51%, compared with the current 4.26%.
• Projection method described:
  • Use the average daily real yield on five-year TIPS over the six months preceding the I Bond rate reset.
  • Multiply that average by 65%, then round to the nearest 0.1 percentage point.
  • The stated average from May 1 to October 16 was 2.06%, implying 1.34% (initially described as 1.3% after rounding down). The presenter then revised the forecast to 1.4%, assuming recent real yields persist. The five-year TIPS real yield was 2.52% on October 16.
  • The presenter said the five-year TIPS average would need to fall below 2.2% over the remaining 10 trading days for the projection to drop to 1.3%. A decline of about 32 basis points was characterized as a large move.
• The presenter’s family planned to wait until after November 1 to buy I Bonds. The projection assumes no major market disruption before month-end and is not guaranteed.
• TIPS are also Treasury inflation-protected securities, but the presenter noted that they differ from I Bonds and planned a separate comparison.

Treasury Yields and Rate Outlook

• Medium- and long-term Treasury yields declined for a second consecutive week. The 20-year yield was 5.47%, down 18 basis points for the week; the 30-year yield was 5.43%, down 17 basis points.
• The presenter said both yields remained at levels last seen more than two decades earlier. Short-term Treasury yields were mostly little changed.
• CME FedWatch showed an 82.8% probability that the Fed would leave its target range at 3.75%–4.00% at the October 28, 2026, meeting.
• The presenter suggested investors who liked current medium- and long-term yields could consider adding Treasuries to their portfolios or dollar-cost averaging. Treasury yields shown were general market indications; actual auction, broker, and sale yields can differ.

Multi-Year Guaranteed Annuities (MYGAs)

Illustrative rates for a $100,000 investment, as quoted for October 16, 2026:

• 3-year: Approximately 5.5%–5.75% from A+ rated carriers; the presenter also cited 5.75% from a single-A-rated carrier.
• 5-year: Up to 5.85%–6.05% from A+ rated carriers and 6.1% from a single-A-rated carrier.
• 7-year: Up to 5.9%–6.15% from A+ rated carriers and 6.2% from a single-A-rated carrier.
• Higher quoted offers from an A− rated carrier were 6.3% for five years and 6.35% for seven years—respectively 1.41 and 1.37 percentage points above comparable Treasury yields, according to the presenter.
• The presenter said the extra yield may reflect Treasury yields having fallen while MYGA rates had not yet adjusted. A+ was described as the highest AM Best rating discussed.
• Risks and liquidity cautions: MYGAs generally do not pay regular interest and are typically illiquid. Some allow up to a 10% annual withdrawal, but terms vary. The presenter advised understanding the product and considering state guaranty association limits when evaluating lower-rated insurers.

Fixed Indexed Annuities (FIAs) With Income Riders

• A featured offer from an A+ rated insurer was described as including a 30% bonus and up to 12 guaranteed annual 10% roll-ups to the income benefit base.
• Illustrations assumed investing $100,000 and starting income after all 12 roll-ups:

Age Potential annual income Approximate income start age Payout ratio 45 Up to $15,545 57 15.5% 50 Up to $17,530 62 17.5% 55 Up to $19,257 67 19.3% 60 Up to $21,012 72 21.0% 63 Up to $22,195 After 12 years 22.2% 65 Up to $23,052 77 23.1%

• These are presented as potential guaranteed lifetime-income illustrations, not as a return on or cash value of the initial investment. The income benefit base and actual contract terms matter.

Disclosures and Cautions

• The annuity figures were described as illustrative, net of fees, and current as of October 16, 2026. Rates and terms depend on factors such as age and state of residence, may change without notice, and are not locked until the contract is signed. Individual terms may differ.
• The video did not state an explicit “not financial advice” disclaimer. The presenter repeatedly encouraged viewers to consult an annuity specialist about suitability for their personal circumstances.

Assets, Instruments, and Sources Mentioned

• Instruments and assets: I Bonds, TIPS, U.S. Treasuries (including Treasury bills and notes), MYGAs, FIAs with income riders, the S&P 500, Nasdaq 100, oil, and gasoline.
• Sources cited: Bureau of Labor Statistics (CPI), Treasury/TIPS market yields, CME FedWatch, and AM Best.
• Presenters and channel: Jennifer (surname unclear in the subtitles) and Marcus are referenced. The video is from Diamond NestEgg.