What are US Savings Bonds?

US Savings Bonds are savings instruments for individual savers, issued by the US Department of the Treasury For the purposes of this program, only Series I savings bonds will be offered.

Series I savings bonds are sold at face value (a $ 50 bond costs $ 50) and their value increases over a period of up to 30 years. Bonus purchases must be in multiples of $ 50 and the total cannot exceed $ 5,000.

Series I bonds pay interest based on a combination of a fixed rate (which remains the same throughout the life of the savings bond) and a semi-annual inflation rate, which is updated in the months of May and November. Savings bonds bear interest until they are redeemed or matured at the end of 30 years.

Savings bonds can be redeemed for principal and accumulated earnings at any time during the 12 months following the date of purchase (unless the taxpayer lives in an area affected by a natural disaster.) Alternatively, the Right to the most recent 3-month interest, if a savings bond is redeemed within the first 5 years. There will be no penalty after 5 years have elapsed.

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