What is a Double E savings bond and how exactly does it work?
by admin ~ October 26th, 2009 . Filed under: Investing .
Bethenia asked:
My father was telling me about this savings bond that you can buy any amount and after 5 years the value is doubled. If this is so, then why wouldn’t everyone just use these instead of risky stocks? What would the disadvantages be of these savings bonds, and is there something really better than this that does not involve risk?
I didn’t say it doubled EVERY 5 years. Well, he said it doubled after 5 years and then after that it just grows little by little. He mentioned that he had a friend who bought a 5,000$ bond back in the 70’s and forgot about it but when he casked it a few years ago he received 40,000$.
My father was telling me about this savings bond that you can buy any amount and after 5 years the value is doubled. If this is so, then why wouldn’t everyone just use these instead of risky stocks? What would the disadvantages be of these savings bonds, and is there something really better than this that does not involve risk?
I didn’t say it doubled EVERY 5 years. Well, he said it doubled after 5 years and then after that it just grows little by little. He mentioned that he had a friend who bought a 5,000$ bond back in the 70’s and forgot about it but when he casked it a few years ago he received 40,000$.
How much is the interest right now? Like if I were to buy one for 100$, what would it gain after that 6 months and what would the maturity date be?
Purchase in denominations of $50, $75, $100, $200, $500, $1,000, and $5,000, and $10,000.
$5,000 maximum purchase in one calendar year.
Thats what that site says… but how would you purchase a 10,000$ bond but you cant buy more than 5,000$ in a year? weird…
Herschel Snuffer
October 29th, 2009 at 8:24 am
EE savings bonds are government bonds. They accrue interest every 6 months. If redeemed early, there is a reduction in the interest rate.
As far as doubling every 5 years, that’s nonsense.
October 31st, 2009 at 12:16 pm
Here you go.
November 3rd, 2009 at 12:29 pm
The U.S. Series I Savings Bond is a better choice.
See note *** at bottom of webpage concerning bond purchase of the $10,000.00 amount.