The time it takes a savings bond to reach face (par) value depends on the series of bond and the value at which it was sold. There are presently three different series of U.S. savings bonds. Series EE and Series I are intended to be savings bonds, and Series HH is intended to be an investment bond.
In general, though, a savings bond is sold as a zero-coupon bond at a discount, and will reach its full value at its maturity. Therefore, savings bonds mature to their full face value.
Key Takeaways
Savings bonds are sold by governments to their citizens to help fund federal spending, and provide savers with a risk-free return.
Savings bonds are sold at a discount and do not pay regular interest. Instead, as they mature, they increase in value until they reach full face value at maturity.
The time to maturity for savings bonds will depend on which series issue is owned.
In 1935, during theGreat Depression, President Franklin D. Roosevelt signed legislation that allowed theU.S. Department of the Treasuryto issue federally backed savings bonds, Series A. In 1941, the Series E bond was first issued to help finance World War IIand were called Defensive Bonds. After the attack on Pearl Harbor, they were called War Savings Bonds, and the money invested in them went directly towardthe war effort.
After the war ended, Americans were encouraged to purchase savings bonds, which provided a way for individuals and families to earn returns on their investments while enjoying the absolute guarantee of the United States government.
Series EE Bonds
Series EE bondsmature after 20 years, meaning they can earn interest for that period of time. EE bonds are sold for half of the face value, and the U.S. Treasury Department guarantees that they will reach face value after 20 years. If the interest payments don't cause the bond to reach full face value at the end of 20 years, the government will do a one-time adjustment to bring the bond's value to equal face value.
It's important to keep in mind, however, that EE bonds must be owned for at least one year before redemption. If they are redeemed before five years, the last three months' worth of interest is forfeited, but after five years, they can be redeemed with no penalty. The annual interest rate for EE bondsissued from Nov. 1, 2018, to April 30, 2019, is0.10%.
Series EE savings bonds originated as Series E war bonds during the WWII era to help fund the war effort.
Series I Bonds
Series I bondsare sold at face value and mature after 30 years. Redemption rules are the same with Series I bonds as Series EE bonds.The composite rate for Series I bonds issued fromNov.1, 2019, throughApril 30, 2020, is2.22%. This rate applies for the first six months that you own the bond.
Series HH Bonds
Series HH bondsare also sold at face value, with bondholders receiving interest payments through direct deposit every six months for the 20-year life of the bond. As of Jan. 2003, HH bonds have earned an interest rate of 1.5%. HH bonds have not been available for purchase since Aug. 2004, but bondholders will continue to receive interest payments until the bonds'maturity.
U.S. Savings Bonds mature after 20 or 30 years, depending on the type of bond: Series EE bonds
Series EE bonds
Key Takeaways. Series EE Bonds are interest-bearing U.S. government savings bonds guaranteed to at least double in value over their typical 20-year initial terms. Some Series EE bonds pay interest beyond the original maturity date, up to 30 years from issuance. There is a $25 minimum investment requirement for EE bonds ...
mature after 20 years. They are sold at half their face value and are worth their full value at maturity. Series I bonds are sold at face value and mature after 30 years.
Savings Bond purchases are generally issued to your TreasuryDirect account within one business day of the purchase date. If you select a non-business day as your purchase date, we will change it to the next available business day.
EE bonds you buy now have a fixed interest rate that you know when you buy the bond. That rate remains the same for at least the first 20 years. It may change after that for the last 10 of its 30 years. We guarantee that the value of your new EE bond at 20 years will be double what you paid for it.
After 20 years, the Patriot Bond is guaranteed to be worth at least face value. So a $50 Patriot Bond, which was bought for $25, will be worth at least $50 after 20 years. It can continue to accrue interest for as many as 10 more years after that.
Series EE savings bonds are a low-risk way to save money. They earn interest regularly for 30 years (or until you cash them if you do that before 30 years). For EE bonds you buy now, we guarantee that the bond will double in value in 20 years, even if we have to add money at 20 years to make that happen.
There are two primary reasons a bond might be worth less than its listed face value. A savings bond, for example, is sold at a discount to its face value and steadily appreciates in price as the bond approaches its maturity date. Upon maturity, the bond is redeemed for the full face value.
U.S. Savings Bonds mature after 20 or 30 years, depending on the type of bond: Series EE bonds mature after 20 years. They are sold at half their face value and are worth their full value at maturity. Series I bonds are sold at face value and mature after 30 years.
Current Series EE bonds mature after 30 years, but they are guaranteed to double in value in the first 20 years during which time the interest rate is fixed. For example, if you invested $5,000 into Series EE bonds today, you are guaranteed to have at least $10,000 in 20 years.
Where do I cash in a savings bond? You can cash paper bonds at a bank or through the U.S. Department of the Treasury's TreasuryDirect website. Not all banks offer the service, and many only provide it if you are an account holder, according to a NerdWallet analysis of the 20 largest U.S. banks.
Yes, the government guarantees that EE bonds sold now will double in value in 20 years. If the bonds don't earn enough interest to double in value, the government will “add money at 20 years to make that happen,” according to TreasuryDirect.
You can get your cash for an EE or I savings bond any time after you have owned it for 1 year. However, the longer you hold the bond, the more it earns for you (for up to 30 years for an EE or I bond). Also, if you cash in the bond in less than 5 years, you lose the last 3 months of interest.
Key points. Series EE bonds mature in 20 years but earn interest for up to 30 years. The U.S. Treasury guarantees Series EE bonds will double in value in 20 years. You don't receive the interest on your Series EE bond until you cash it.
If you purchase a Series EE bond today, you are guaranteed to earn a fixed interest rate for 20 years, which is when the bond matures. At 20 years, the government ensures that you will be paid double the face value of the bond.
They're available to be cashed in after a single year, though there's a penalty for cashing them in within the first five years. Otherwise, you can keep savings bonds until they fully mature, which is generally 30 years. These days, you can only purchase electronic bonds, but you can still cash in paper bonds.
U.S. Savings Bonds mature after 20 or 30 years, depending on the type of bond: Series EE bonds mature after 20 years. They are sold at half their face value and are worth their full value at maturity. Series I bonds are sold at face value and mature after 30 years.
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