by Christopher Smith
Let’s face it. Savings bonds are not as exciting or risky as stocks, but, isnt that the point? While there is no such thing as a no risk investment, odds are, a savings bond is about as risk free as you can get, especially a US savings bond. Odds are, you or someone you know, was probably given one as a child. Unfortunately, the popularity of these investment vehicles has been dwindling as fewer and fewer people are informed about their benefits. There is a reason why many of the most successful stock market investing millionaires also hold a position in US Savings Bonds. There is a good reason for it.

What Exactly Is A US Savings Bond?
Savings bonds are a type of long term investment that used to be rather popular. There are a whole slue of different types of savings bonds out there, but this type of savings bonds are by far the most reliable, being backed by the United States government in quality and guarantee, and that is something that definitely plays on the positive side of the U.S. savings bond. In all actuality, a savings bond of this type is actually a loan to the U.S. government and the bond itself is a guarantee that the ‘loan’ will be paid back in full after a set period of time during which the bond will mature.

Where Can I Get A US Savings Bond?
A great place to buy a savings bond is at your local bank. The most popular type of US Savings Bond are the Series EE which can be purchased at half the face value. So a $100 bond would cost $50. The minimum purchase is $25 while the maximum is $30 000 (although, you can purchase an additional $30 000 electronically). These types of bonds earn market based rates which change every 6 months. As such, there is no way to predict when it will reach its face value. These bonds much also be held for a minimum 12 months.

The other type of US Savings Bonds are the I Bonds which are an accrual type investment. Simply put, interest is added to the bond on a monthly basis. The rate of interest is determined each May and November and is based on the Consumer Price Index.

When Can I Cash in My Bond?
The amount of time that a U.S. savings bond takes to mature depends on the bond and the amount, and when it was purchased. The higher the rate was at the time of the purchase, the faster the bond will reach maturity in which the bond can be cashed in for the whole amount it is worth. Usually these savings bonds take no longer than 20 years to mature, but they can collect interest for up to 30 years after the date of purchase.

Savings bonds are not the type of thing that everyone can get into. Some people want the type of investment that they can get a quick return on, and that is okay–just not good for U.S. savings bonds. However, this is a great way to get your feet wet as far as making investments go, and put some money away for a rainy day– a rainy day in the next several years, that is.

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