6 key things to know about inflation-indexed bonds paying 9.62 percent  The Treasury building in Washington. (Samuel Corum/Bloomberg News) | The inflation-indexed Series I savings bonds are red hot right now. With the stock market down and savings account rates up a bit but still paying pitiful rates, a savings bond backed by the federal government paying 9.62 percent is like coming inside from an oppressive heat wave into an air-conditioned room. [Now is a good time to buy this inflation-indexed savings bond] The I bond was created as a hedge against inflation. Now that inflation is at a 40-year high, the bonds are a haven for people with funds they don't need immediately. The 9.62 percent rate is good until the end of October. Several callers to ASK-POST (855-275-7678), my toll-free line, have been asking about I bonds and sharing their difficulties in buying them. One question in particular kept popping up. People wanted to know how to be sure to pass on the bonds if they died before cashing them. How do I add a beneficiary for my I bonds? I laughed out loud when I read this on TreasuryDirect about naming a secondary owner or beneficiary: "Adding a secondary owner or beneficiary to securities registered in single ownership form is simple." Clearly, the folks who write the instructions for navigating TreasuryDirect have a sense of humor. As I've found trying to set up my own TreasuryDirect.gov account, the instructions and procedures for buying I bonds are not so simple, as evidenced by the many calls and emails I received asking how to name a beneficiary. And it's important to name a secondary owner or beneficiary to avoid probate, so here's what you need to do. For step-by-step directions, go to TreasuryDirect and search for "How do I …?" You'll see this question: "How do I add a secondary owner or beneficiary to my securities?" The directions tell you to click on the "ManageDirect" tab at the top of the page. It's in this area you will find registration information. Under "Manage My Securities," click the link for "Edit a registration." Choose the bond or bonds you want to edit on the next page. To add to the registration, your choices will be sole owner, primary owner or beneficiary. If you want a secondary owner, select the option for the primary owner. If you plan to buy more bonds and name the same secondary owner or beneficiary, you can select "Make this my preferred registration." When you name a beneficiary, the registration says "Payable on Death," or "POD." When the primary owner dies, the other becomes the sole owner of the bond. When you name a secondary owner, the registration says you own the bond "with." You can have only one secondary owner or one beneficiary for each bond. So, let's say you have two adult children and you have $10,000 to purchase an I bond. If you want to leave each child half, you would have to purchase two $5,000 bonds and then designate each as a beneficiary. You can change the secondary owner or beneficiary at any time. [A step-by-step guide to buying inflation-indexed I series government savings bonds] Are spouses who file joint tax returns restricted to the $10,000 annual purchase limit? Individuals can purchase up to $10,000 in electronic I bonds in a calendar year. This means you and your spouse can each purchase up to $10,000. You can also purchase up to $5,000 in paper I bonds using your federal income tax refund, bringing the possible total to $15,000 for individuals for the calendar year. Can I buy I bonds in my kids' names? To buy an electronic I bond, you have to set up an account at TreasuryDirect.gov. A child can't establish a TreasuryDirect account. But adults can buy savings bonds for children under the age of 18 and register the bonds in the name of a child or children. You can set up a minor account that is linked to your TreasuryDirect account. The only way to access the minor's account is through your account. Log into your own primary TreasuryDirect account. Click the "ManageDirect" tab. Under the heading "Manage My Linked Accounts," click "Establish a Minor Linked Account." On TreasuryDirect, search for "How Do I Open an Account for a Minor?" for further information about accounts for children. For more of the key things to know about inflation-indexed bonds paying 9.62 percent, click the link below. Your feedback If you have a personal finance question for Washington Post columnist Michelle Singletary, please call 1-855-ASK-POST (1-855-275-7678). Send your comments and questions to colorofmoney@washpost.com, but due to the volume of mail, personal responses may not be possible. Please also note comments or questions may be used in a future column, with the writer's name, unless a specific request to do otherwise is indicated. | 
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