1. What is the EE Savings Bond Calculator?

The EE Savings Bond Calculator estimates the future value of US Treasury EE Savings Bonds based on the issue price, annual interest rate, and time held. EE Bonds are low-risk savings instruments issued by the US government that earn interest for up to 30 years.

2. How Does the Calculator Work?

The calculator uses the EE Savings Bond formula:

Where:

• \( FV \) — Future Value (bond value in USD)
• \( P \) — Issue Price (purchase price in USD)
• \( r \) — Annual Interest Rate (expressed as decimal)
• \( t \) — Time Since Issue (in years)

Explanation: The formula calculates compound interest with semi-annual compounding, which is how EE Savings Bonds accrue interest.

3. Importance of EE Savings Bond Calculation

Details: Accurate bond valuation helps investors track their savings growth, plan for future financial goals, and make informed decisions about holding or redeeming bonds.

4. Using the Calculator

Tips: Enter the original purchase price (issue price) in USD, the annual interest rate as a decimal (e.g., 0.025 for 2.5%), and the time held in years. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What are EE Savings Bonds?
A: EE Savings Bonds are US government savings bonds that earn interest for up to 30 years. They are guaranteed to double in value in 20 years.

Q2: How often do EE Bonds compound interest?
A: EE Bonds compound interest semi-annually, meaning interest is calculated and added to the principal twice per year.

Q3: What is the minimum investment for EE Bonds?
A: The minimum purchase amount for EE Bonds is $25 when buying electronically through TreasuryDirect.

Q4: Are EE Bonds taxable?
A: Interest earned on EE Bonds is subject to federal income tax but exempt from state and local income taxes.

Q5: When can I redeem my EE Bonds?
A: EE Bonds must be held for at least one year, and if redeemed within the first 5 years, you'll forfeit the last 3 months of interest.