What’s happened with savings bonds so far in 2013:
1) Junk Hauler Finds (and returns) $114,000 Of Savings Bonds
2) Record Low Rates For Savings Bonds (but they are still a great investment)
3) The End Of Paper Savings Bonds
More details of these stories.
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A Junk Hauler Finds $114,000 Of Treasury Bonds
In October 2012, an independent junk hauler found saving bonds with a face value of $22,000 hidden in one of the items he was removing. The present day value of the savings bonds is $114,000. (Click here to find the value of your savings bonds.) The junk hauler returned the bonds to their rightful owners and was hailed by the media as a good citizen.
The problem with this story is that the junk hauler could not have cashed in the savings Bonds. Savings bonds are always in the name of an individual. In this case, the bonds were in the name of the deceased mother of the owner of the house from which the junk was being taken. Except to the owner of the house, the bonds had no value.
Record Low Rates For Savings Bonds
2013 has been a year of record low rates. The interest rate for newly purchased EE Series bonds are at a record low of 0.2%. (Rates for I Bonds, click here) The rate first went down to this level in November 2012 and will stay there until at least November 2013. While this rate seems very low, the interest rate when EE bonds are held to maturity is much higher, around 3.5%. (Full explanation) If you can wait 20 years for an EE savings bond to mature, they provide an excellent yield for one the safest investments in the world.
The End Of Paper Savings Bonds
At the end of 2012, the Treasury Department stopped selling paper saving bonds through banks. The Treasury estimates going paperless will save taxpayers around $70 million over 5 years. However, saving bonds haven’t yet gone entirely paperless. If you request your tax refund in savings bonds, you will get the old fashioned, traditional savings bonds. However, the word on the street is that Treasury department would like to do away with paper savings bonds entirely!Want to learn how to generate more income from your portfolio so you can live better? Get our free guide to income investing here.