U.S. Savings Bonds come in several different varieties. Series E bonds, also known as “War Bonds,” were issued in May 1941 and helped to finance World War II. In 1980, Series EE bonds replaced Series E bonds. The following table explains the basic characteristics of Series E and EE bonds.
Features of Series EE and Series E Savings Bonds
| Features |
EE Bonds |
E Bonds |
| Issued |
January 1980 – present |
May 1941 – June 1980 |
| Type |
Accrual bond; interest is paid at redemption as part of the current redemption value |
same as EE bonds |
| Purchase Cost |
50% of face value (a $100 bond can be purchased for $50) |
75% of face value (a $100 bond was purchased for $75) |
| Denominations |
$50; $75; $100; $200; $500; $1,000; $5,000; $10,000 |
$25; $50; $75; $100; $200; $500; $,1000; $5,000; $10,000 |
| Limit |
$30,000 ($15,000 face value) |
| Transferability |
no |
no |
| Investment Yield |
Interest is paid when the bond is redeemed; interest is earned for up to 30 years of issue date; interest accrues on the first day of the each month after the third month after issue; calculated as 90% of 6-month averages of 5-year Treasury Securities yields; rates announced in May and November; guaranteed to reach face value in 17 years; increases in value monthly and compounded semiannually;
To check out current rates, click here. |
A guaranteed yield in effect at the beginning of an original or extended maturity period to the end of the original or extended maturity period (extended period is 10 years beyond original date); minimum yield is 4% compounded semiannually for extended period starting on or after March 1,1993 |
| Redemption |
If purchased before Feb. 2003, cannot be redeemed until 6 months after issue. If purchased after Feb. 2003, cannot be redeemed until 12 months after issue.Can be redeemed at any Federal Reserve Bank or your financial institution. |
| Penalty |
3 months interest if redeemed during first 5 years |
|
| Exchange |
Can be exchanged for Series HH bonds, but bonds must be at least 6 months old. |
Can be exchanged for Series HH bonds |
| Taxes |
Exempt from state and local income taxes; interest reported for Federal income tax in the year the bond is redeemed; possible to report interest each year it accrues but must apply to all of owner’s accrual-type securities |
same as Series EE bonds |
