Savings bonds, one of the safest investments, are debt securities issued by the U.S. Department of the Treasury to pay for the government’s borrowing needs.
Now that you have a good grasp on what bond insurance is, we’ll get into savings bonds and how they work.
What is a savings bond?
A U.S. Savings Bond is a U.S. government savings bond that offers a fixed rate of interest over a fixed period of time. These bonds are not subject to state or local income taxes, which makes them appealing to many. These bonds, however, can’t be transferred easily and are non-negotiable.
Savings bonds are virtually risk-free. Seriously. Even if the bond is lost or destroyed, it can still be replaced – since savings bonds are registered with the government. Although they don’t earn much interest compared to the stock market, they do offer a much less volatile source of income. They also can’t be cashed until at least six months post-purchase, and the longer you wait to cash the bond, the more interest it earns. This makes these bonds great for saving for the future.
How do savings bonds work?
Savings bonds pretty much work like other bonds. They’re essentially a loan that you make to the U.S. government. Like T-bills, savings bonds are debt securities issued by the Department of Treasury.
There are 2 different types of savings bond: Series EE and Series I. Both are purchased for face value and both must be held at least one year. After five years, they can be redeemed without penalty. Series EE bonds pay a fixed rate of return and are guaranteed to at least double in value in 20 years.
How (and where) to buy savings bonds?
As of 2012, savings bonds can now be purchased online. You can buy them through the Treasury-s website or through an employer-sponsored plan. You can buy any denomination from $25 and up, with a calendar limit of $10,000.
Previously, paper savings bonds were purchased at half of face value. The bond would be redeemed for full face value at maturity. Recently, however, savings bonds have gone online. This is why they were called “zero-coupon” bonds – you got all your interest payments and principal back when the loan came due! Today…savings bonds earn interest regularly.
Where to cash / redeem savings bonds
Cashing savings bonds can be done in a bank or online. Many local banks will happily redeem your savings bonds for you, but you can also use the Treasury’s website if purchased electronically. Just keep in mind that there is a penalty for early redemption! Try not to cash in before 5 years, unless absolutely necessary, because you will lose three months’ interest.
Savings bonds are really great for saving for the future. If you want to learn more about them, check out our Investing in Different Markets course today!
Ranking of Top Stock Newsletters Based on Last 3 Years of Stock Picks as of August 16, 2025
We are paid subscribers to dozens of stock and option newsletters. We actively track every recommendation from all of these services, calculate performance, and share our results of the top performing stock newsletters whose subscriptions fees are under $500. The main metric to look for is "Return vs SP500" which is their return above that of the S&P500. So, based on August 16, 2025 prices:
Best Stock Newsletters
| Rank | Stock Newsletter | Picks Return | Return vs SP500 | Picks w Profit | Max % Return | Current Promotion |
|---|---|---|---|---|---|---|
| 1. |  Alpha Picks | 74.7% | 51.1% | 78% | 969% | Sept, 2025 Promotion: Save $50 |
| Summary: 2 picks/month based on Seeking Alpha's Quant Rating; Retail Price is $499/yr. See complete details and analysis in our Alpha Picks Review. | ||||||
| 2. |  Moby.co | 52.5% | 18.1% | 73% | 2,406% | Sept, 2025 Promotion:Next pick free! |
| Summary: 60-150 stock picks per year, segmented by industry; Retail Price is $199/yr. Read our Moby Review. | ||||||
| 3. |  Zacks Top 10 | 33.0% | 15.1% | 73% | 170% | Sept, 2025 Promotion:$1, then $495/yr |
| Summary: 10-25 stock picks per year based on Zacks' Quant Rating; Retail Price is $495/yr. Read our Zacks Review. | ||||||
| 4. |  TipRanks SmartInvestor | 18.6% | 7.6% | 65% | 386% | Current Promotion: Save $180 |
| Summary: About 1 pick/week focusing on short term trades; Lifetime average return of 355% vs S&P500's 149% since 2015. Retail Price is $379/yr. Read our TipRanks Review. | ||||||
| 5. |  Stock Advisor | 41.7% | 6.1% | 76% | 299% | Sept, 2025 Promotion: Get $100 Off |
| Summary: 2 picks/month and 2 Best Buy Stocks lists focusing on high growth potential stocks over 5 years; Retail Price is $199/yr. Read our Motley Fool Review. | ||||||
| 6. |  Action Alerts Plus | 25.9% | 4.9% | 65% | 210% | Current Promotion: None |
| Summary: 100-150 trades per year, lots of buying and selling and short-term trades. Read our Jim Cramer Review. | ||||||
| 7. | Rule Breakers | 35.6% | 1.2% | 78% | 273% | Current Promotion: Save $200 |
| Summary: 2 picks/month focusing on disruptive technology and business models; Lifetime average return of 355% vs S&P500's 149% since 2005; Now part of Motley Fool Epic. Read our Motley Fool Epic Review. | ||||||
| 8. | Zacks Home Run Investor | 3.5% | -1.3% | 44% | 200% | Sept, 2025 Promotion:$1, then $495/yr |
| Summary: 40-50 stock picks per year based on Zacks' Quant Rating; Retail Price is $495/yr. Read our Zacks Review. | ||||||
| 9. | IBD Leaderboard ETF | 11.4% | -1.8% | n/a | n/a | Sept, 2025 Promotion:Save $129/yr |
| Summary: Maintains top 50 stocks to invest in based on IBD algorithm; Retail Price is $495/yr. Read our Investors Business Daily. | ||||||
| 10. | Stock Advisor Canada | 23.5% | -4.6% | 69% | 378% | Sept, 2025 Promotion: Save $100 |
| Summary: 1 pick/month from the Toronto stock exchange; Retail Price is CD$199/yr. Read our Motley Fool Canada Stock Advisor Review. | ||||||
| Top Ranking Stock Newsletters based on their 2024, 2023, 2022 stock picks' performance as compared to S&P500. S&P500's return is based on average return of S&P500 from date each stock pick is released. NOTE: To get these results you must buy equal dollar amounts of each pick on the date the stock pick is released. Investor Business Daily Top 50 based on performance of FFTY ETF. Performance as of August 16, 2025. | ||||||