1. What is the Savings Bond Calculator?

The TreasuryDirect Savings Bond Calculator estimates the current value of savings bonds using semi-annual compounding. It helps investors track the growth of their bond investments over time.

2. How Does the Calculator Work?

The calculator uses the savings bond value formula:

Where:

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

Explanation: The formula uses semi-annual compounding, meaning interest is calculated twice per year and added to the principal.

3. Importance of Savings Bond Calculation

Details: Accurate bond valuation helps investors understand their investment 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 held. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What types of savings bonds does this calculator work for?
A: This calculator works for Series EE and Series I savings bonds that use semi-annual compounding.

Q2: How often is interest compounded on savings bonds?
A: Most savings bonds compound interest semi-annually (twice per year).

Q3: What is the minimum investment for savings bonds?
A: The minimum purchase amount for electronic savings bonds is $25 through TreasuryDirect.

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

Q5: How long do savings bonds earn interest?
A: Series EE bonds earn interest for 30 years, while Series I bonds earn interest for 30 years.