United States savings bonds remain a solid investment vehicle just as they were when President Franklin D. Roosevelt signed off on legislation that generated the first savings bonds, called “baby bonds,” in 1935.
The savings bond’s mission hasn’t changed much since the Roosevelt administration. The goal was — and is — to encourage consumer savings on a wide scale while allowing Americans to fully participate in US government financing.
But how do savings bonds work? More importantly, what impact can savings bonds have on your savings and investment portfolio?
Here’s a closer look at savings bonds, so you can make the right choice if you decide to partner with Uncle Sam and own your piece of financial Americana.
What are savings bonds?
Savings bonds are high-safety, low-interest-rate loans to the federal government (issued as a bond) for a period of up to 30 years. They are fully backed by…
