U.S. Savings Bond Calculator Series EE

Series EE Bond Formula:

\[ FV = P \times (1 + r / 2)^{2 \times t} \]

Bond Value (FV):

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1. What is the Series EE Savings Bond?

Series EE savings bonds are U.S. government savings bonds that earn interest monthly and compound semiannually. They are guaranteed to at least double in value over 20 years, making them a secure long-term investment.

2. How Does the Calculator Work?

The calculator uses the Series EE bond formula:

\[ FV = P \times (1 + r / 2)^{2 \times t} \]

Where:

$ FV $ — Future value or bond value (USD)
$ P $ — Issue price or principal amount (USD)
$ r $ — Annual interest rate (decimal)
$ t $ — Time since issue in years

Explanation: The formula calculates the future value of a Series EE bond with semiannual compounding, where interest is added to the principal twice per year.

3. Importance of Bond Valuation

Details: Accurate bond valuation helps investors understand the growth of their savings bonds over time, plan for future financial needs, and compare investment returns with other financial instruments.

4. Using the Calculator

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

5. Frequently Asked Questions (FAQ)

Q1: What is the minimum investment for Series EE bonds?
A: The minimum purchase amount for Series EE bonds is $25 when buying electronically through TreasuryDirect.

Q2: How long do Series EE bonds earn interest?
A: Series EE bonds earn interest for 30 years. They are guaranteed to double in value in 20 years, and continue earning interest for another 10 years.

Q3: Are Series EE bonds taxable?
A: Interest earned on Series EE bonds is subject to federal income tax but exempt from state and local income taxes. Tax can be deferred until redemption or final maturity.

Q4: Can I redeem my Series EE bond before maturity?
A: Yes, but you must hold the bond for at least one year. If redeemed before 5 years, you'll forfeit the last 3 months of interest.

Q5: Where can I purchase Series EE bonds?
A: Series EE bonds can be purchased electronically through the TreasuryDirect website. Paper bonds are no longer sold through financial institutions.