I Bonds vs Treasury Bills 2026: Where to Park Your Cash When the Fed Won't Cut

# I Bonds vs Treasury Bills 2026: Where to Park Your Cash When the Fed Won't Cut

> **Quick answer:** As of May 1, 2026, I Bonds pay 4.26% — beating the 12-month Treasury Bill yield of 3.75% by half a percentage point. But I Bonds lock up your money for one year minimum. With the Fed frozen in place through 2026 and HYSA rates already sliding below 4% at most banks, the right choice depends entirely on when you need the cash and what state you pay taxes in.

The Fed held rates steady for the fourth consecutive meeting on April 29, 2026 — Jerome Powell's final press conference as chair. Markets had hoped for rate cut signals. They got none. The probability of any 2026 rate cut has collapsed to roughly 3%, per Morningstar. And on May 1, Treasury quietly set the new I Bond composite rate at 4.26%, the highest since late 2024.

If you have cash sitting in a savings account, money market fund, or a Treasury ladder, this is the moment to run the math. The spread between these options has changed meaningfully — and so has the duration of the rate environment you're planning around.

*This article is for informational purposes only and does not constitute financial advice. Consult a qualified financial advisor for personal financial decisions.*

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