1. What is the EE Savings Bond Calculator?

The EE Savings Bond Calculator determines the current value of EE savings bonds using the compound interest formula. EE bonds are U.S. government savings bonds that earn interest monthly and compound semiannually.

2. How Does the Calculator Work?

The calculator uses the EE Savings Bond formula:

Where:

• \( V \) — Current value of the bond (USD)
• \( P \) — Purchase amount/principal (USD)
• \( rate \) — Annual interest rate (decimal form)
• \( y \) — Number of years the bond has been held

Explanation: The formula accounts for semiannual compounding, where interest is calculated twice per year and added to the principal.

3. Importance of EE Savings Bond Calculation

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

4. Using the Calculator

Tips: Enter the original purchase amount in USD, annual interest rate as a decimal (e.g., 0.025 for 2.5%), and the number of years the bond has been held. All values must be positive.

5. Frequently Asked Questions (FAQ)

Q1: What are EE Savings Bonds?
A: EE bonds are U.S. government savings bonds that are guaranteed to double in value in 20 years and continue earning interest for up to 30 years.

Q2: How often does interest compound on EE bonds?
A: Interest compounds semiannually (every 6 months) and is added to the bond's value monthly.

Q3: What is the minimum investment for EE bonds?
A: The minimum purchase amount for electronic EE bonds is $25. Paper EE bonds are no longer issued.

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: Can I redeem EE bonds before maturity?
A: EE bonds cannot be redeemed within the first 12 months of purchase. If redeemed between 1-5 years, you'll lose the last 3 months of interest.