I usually get asked what to do with excess cash savings. I never really have a GREAT answer. Rates are just too low and the only way is to take some sort of risk.

Well in this limited case, not anymore.

Series I Savings Bonds through the US Treasury are now earning 7.12%. If you have excess cash that you don’t think you will need for at least a year (but ideally five years) then these are a good bet. There are a few caveats:

1. The rate is adjustable. It will not earn 7.12% forever but it is tied to inflation via the Consumer Price Index. So, if inflation continues out of control, then these bonds will benefit from higher interest payments. If inflation cools down, the rate on the bonds will decrease. It is a semiannual inflation adjustment.

2. You are capped on how much you can put in. There is a limit of $10,000 per person / per calendar year. Additionally,