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Key takeaways
- A savings bond is a low-risk way to save money, which is issued by the Treasury and backed by the U.S. government.
- Savings bonds pay interest only when they’re redeemed by the owner, and they earn interest for as long as 30 years.
- Electronic bonds can be cashed on the TreasuryDirect website, while paper bonds can be redeemed at most bank or credit union branches.
Savings bonds are a type of debt security issued by the U.S. government. Unlike typical bonds that pay interest regularly, a savings bond is a zero-coupon bond, meaning it pays interest only when it is redeemed by the owner. The bond is also nontransferable, so it can’t be sold to someone else, which distinguishes it from more typical bonds.
If you’re considering savings bonds as part of a personal savings plan, there are some important details to know about how the bonds…
