Savings bonds are a way for average Americans to buy U. Currently, U. Savings bonds are considered one of the safest investments that you can buy, because they are backed by the full faith and credit of the U. Basically, the government would have to fall apart for your bonds not to be honored. You buy the bond for less than usually half of the face value. A series EE bond will reach full face value after 20 years and will stop earning interest after 30 years.
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Do Savings Bonds Continue to Earn Interest After Maturity? | Finance - Zacks
The time it takes a savings bond to reach face value depends on the series of bond and the value at which it was sold. There are three different series of bonds. EE bonds are sold for half of the face value, and the U. 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.
How Do Savings Bonds Work? Know the Facts and Save Securely
Why Zacks? Learn to Be a Better Investor. Forgot Password. Savings Bond is a debt security that has been issued by the Department of the Treasury as a means of financing federal borrowing.
While purchasing U. Treasury bonds, you may have noticed some Series EE savings bonds mature on different dates. For example, the U. Treasury's EE bonds issued in and only took eight years to reach full face value, while the same EE bonds issued in took 20 years to reach their full face value.