Conn. (WTNH) — With the cost of living rising at a 40-year high, people looking for some extra cash are turning to one financial opportunity, an I-Bond, which is also called an inflation bond.

It’s backed by the federal government and it has a high interest rate right now; we’re Stretching Your Dollar with what you should know if you’re considering an I-Bond.

“They are really attractive if someone is sitting on cash but it is not an investment, this is a place to park savings,” Derek Amey, partner at Strategic Point Investment Advisors, said.

An I-BOND or inflation bond is backed by the U.S. government. Right now, the interest rate is 9.62%. That’s something Amey said is unheard of.

“I have been here for over 20 years and these were not a vehicle that anybody had ever asked about until the last basically six to nine months, because we haven’t seen inflation in this country, at least to this rate, in the late ’70s, early ’80s.”

The interest rates change twice a year. Amey explained that although there is a potential for a good return, there is a cap on how much money can be put into the bond.

“It resets may first and November first every year and it is just tied to CPI, which is the consumer price index, which is what they also use to figure out what social security bump is going to be for retirees,” Amey said.

Amey noted that although there is potential for a good return, there is a cap on how much money can be put into the bond.

“I think there is, the problem is, if there is an issue, we are all capped at $10,000 a year,” Amey said.