On November 1, 2013 the government announced the new interest rate for EE Savings Bonds– .1%. You read that correctly, not 1% but .1%. So if you invest $1,000 today, at the end of one year you will have earned… drum roll please… $1. But wait, if you cash after one year there is a three month interest penalty, so you will net a whopping 75 cents on that $1,000. Who is going to buy this? Seems that the new rates help achieve an objective seemingly behind many of the savings bond decisions over the past decade–to reduce and potentially eliminate the program.
If you own older bonds the picture is not so bleak. Many are still earning 3-5%. Find out the specific rates on your bonds with a savings bond statement. There is a select group of bonds that will provide a double digit return this next year. These are outlined in a bond statement and also in the newsletter Savings Bond Insight: The Next Chapter.
More Savings Bond Help:
Dan Pederson is author of Savings Bonds: When to Hold, When to Fold and publishes an annual newsletter Savings Bond Insight: The Next Chapter for $19.95. He provides savings bond consultations regarding retitling bonds, finding lost bonds and savings bond dilemmas. His company offers a free record keeping sheet by calling 1-800-927-1901 or visiting the web site.