I bond vs T-bill vs CD: rates, rules and taxes compared
- I bond composite4.26%through Oct 31, 2026
- 13-week T-bill4.195%auction Oct 19, 2026
- 12-month CD avg.1.76%FDIC, Oct 19, 2026
Series I savings bonds, Treasury bills and bank CDs side by side: current official rates, how long the money is tied up, state tax treatment, purchase limits and how each is purchased.
Every figure links to TreasuryDirect, Treasury auction results or the FDIC.
I bond rate as of Oct 23, 2026 (TreasuryDirect; resets Nov 1, 2026). T-bills from each term's latest auction. FDIC national rates published Oct 19, 2026.
Current official rates
| Option | Rate | Source, date |
|---|---|---|
| I bond (composite rate, issued May 1, 2026 to Oct 31, 2026) | 4.26% | TreasuryDirect, checked Oct 23, 2026 |
| I bond fixed-rate part (lasts the life of the bond) | 0.90% | TreasuryDirect, checked Oct 23, 2026 |
| 4-Week Treasury bill (investment rate, latest auction) | 4.012% | Treasury auction, Oct 22, 2026 |
| 13-Week Treasury bill (investment rate, latest auction) | 4.195% | Treasury auction, Oct 19, 2026 |
| 26-Week Treasury bill (investment rate, latest auction) | 4.372% | Treasury auction, Oct 19, 2026 |
| 52-Week Treasury bill (investment rate, latest auction) | 4.616% | Treasury auction, Sep 29, 2026 |
| FDIC national average, 3-month CD | 1.14% (cap 5.79%) | FDIC, Oct 19, 2026 |
| FDIC national average, 6-month CD | 1.39% (cap 5.95%) | FDIC, Oct 19, 2026 |
| FDIC national average, 12-month CD | 1.76% (cap 6.20%) | FDIC, Oct 19, 2026 |
| FDIC national average, 24-month CD | 1.55% (cap 6.61%) | FDIC, Oct 19, 2026 |
| FDIC national average, 60-month CD | 1.41% (cap 6.86%) | FDIC, Oct 19, 2026 |
| FDIC national average, savings | 0.38% (cap 4.63%) | FDIC, Oct 19, 2026 |
Rates are not directly comparable: the I bond rate applies for 6 months and then resets; T-bill rates are fixed to maturity; FDIC figures are national averages, not the rates any single bank offers. The FDIC national rate cap is the ceiling that generally applies to banks that are less than well capitalized. I bond figures checked on TreasuryDirect Oct 23, 2026; FDIC figures published Oct 19, 2026.
Side by side: liquidity, taxes, limits
| Feature | I bond | Treasury bill | Bank CD |
|---|---|---|---|
| Rate set by | Fixed rate + inflation rate, reset every May 1 and Nov 1 | Auction; fixed until maturity | Each bank |
| Access to money | Locked 12 months; before 5 years the last 3 months of interest are lost | Paid at maturity (4 to 52 weeks); can be sold before maturity through a broker or bank | Bank's early-withdrawal penalty applies |
| Federal income tax | Yes (can be deferred until cashed in) | Yes | Yes |
| State and local income tax | No | No | Generally yes |
| Purchase limit | $10,000 electronic per SSN or EIN per calendar year; $25 minimum | $100 minimum; $10 million per auction (non-competitive) | Set by the bank |
| Backing | U.S. Treasury | U.S. Treasury | FDIC insurance, at least $250,000 per insured bank |
| Where purchased | TreasuryDirect account only | TreasuryDirect, or a bank or broker | A bank or credit union, or a broker (brokered CDs) |
Sources: TreasuryDirect: I bonds, TreasuryDirect: Treasury bills, FDIC: deposit insurance; checked Oct 23, 2026.
Liquidity
Per TreasuryDirect, an I bond cannot be cashed in for 12 months, and cashing in before 5 years forfeits the last 3 months of interest. A Treasury bill pays face value at maturity and can be sold before then. CD early-withdrawal penalties vary by bank and are disclosed by the bank.
State tax treatment
TreasuryDirect lists I bond and Treasury bill interest as subject to federal income tax but exempt from state and local income tax. CD and savings interest is generally taxable by states with an income tax. The T-bill vs CD after-tax tool shows the arithmetic.
How to purchase
- I bonds. Open an account at TreasuryDirect and purchase electronic I bonds there; paper I bonds have not been sold since Jan 1, 2025 (TreasuryDirect). The rate in effect on the issue date applies for the first 6 months.
- Treasury bills. Place a non-competitive bid in a TreasuryDirect account before the auction, or purchase through a bank or broker (TreasuryDirect). Upcoming dates are on the auction calendar.
- CDs. Open a CD at a bank or credit union, or purchase a brokered CD. Check that the bank is FDIC-insured and read its early-withdrawal penalty (FDIC). The FDIC national rates page shows the monthly averages.
Not yet confirmed
Not yet published as of Oct 23, 2026: the I bond fixed and composite rates for bonds issued Nov 1, 2026 to Apr 30, 2027. TreasuryDirect posts them on Nov 1; this page will show them once they are official. No estimate is given here.
Related: where to park cash: T-bills vs CDs vs savings · year-end money moves 2026 · T-bill vs CD vs savings after tax · T-bill at TreasuryDirect, step by step · Treasury auction results · FDIC national CD and savings rates.
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Frequently asked questions
When does the I bond rate change next?
TreasuryDirect announces new I bond rates every May 1 and November 1. The next announcement is due Nov 1, 2026. As of Oct 23, 2026 the new rate had not been published, so this page shows only the current rate (4.26% composite, 0.90% fixed, for I bonds issued May 1, 2026 to Oct 31, 2026) and does not estimate the next one.
Can an I bond be cashed in early?
Per TreasuryDirect, an I bond can be cashed in after 12 months. Cashing in before 5 years forfeits the last 3 months of interest; for example, cashing in after 18 months pays the first 15 months of interest.
Which of the three is exempt from state income tax?
Per TreasuryDirect, I bond and Treasury bill interest is subject to federal income tax but not state or local income tax. Bank CD and savings interest is generally taxable at both the federal and state level.
Are I bonds and T-bills FDIC-insured?
No. I bonds and Treasury bills are obligations of the U.S. Treasury, not bank deposits. CDs and savings accounts at FDIC-insured banks are insured to at least $250,000 per depositor, per insured bank, per ownership category, according to the FDIC.
Is this page personalized advice?
No. It is an educational comparison of published rates and rules from TreasuryDirect, Treasury auction results and the FDIC. It does not consider any individual's situation; a tax or financial professional can address specifics.