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Miles Kelly
Miles Kelly

How To Buy Us Bonds Fixed



This page focuses on buying for yourself or a child whose account is linked to yours. If you are planning to give a savings bond as a gift, also see our page on Giving savings bonds as gifts. You can print a certificate announcing your gift. See our selection of announcement cards.




how to buy us bonds



In any one calendar year, you may buy up to $10,000 in Series EE electronic savings bonds AND up to $10,000 in Series I electronic savings bonds for yourself as owner of the bonds. That is in addition to the amount you can spend on buying savings bonds for a child or as gifts.


For example: If you want to buy $50 Series I savings bonds and you ask your employer to send $25 from each paycheck to your TreasuryDirect account, we issue a $50 bond for you after every other payday. You don't have to think about it again or do anything else. You keep getting more savings bonds automatically until you change or end your Payroll Savings Plan.


We may issue multiple bonds to fill your order. The bonds may be of different denominations. We use $50, $100, $200, $500, and $1,000 bonds. Again, the amount of your purchase can be any multiple of $50, from $50 to $5,000. You need to tell us only the amount. We determine denominations.


On Form 8888, you also specify who will own the bonds. That means, you can give paper savings bonds to yourself or to anyone else (as a gift). If you have enough money in your refund, you can buy multiple bonds and, if you wish, you can give them multiple registrations.


Series I savings bonds protect you from inflation. With an I bond, you earn both a fixed rate of interest and a rate that changes with inflation. Twice a year, we set the inflation rate for the next 6 months.


Newly issued Treasuries can be purchased at auctions held by the government, while previously issued bonds can be purchased on the secondary market. Both types of orders can be placed through Fidelity.*


Investors in Treasury notes (which have shorter-term maturities, from 1 to 10 years) and Treasury bonds (which have maturities of up to 30 years) receive interest payments, known as coupons, on their investment. The coupon rate is fixed at the time of issuance and is paid every six months.


Other Treasury securities, such as Treasury bills (which have maturities of one year or less) or zero-coupon bonds, do not pay a regular coupon. Instead, they are sold at a discount to their face (or par) value; investors receive the full face value at maturity. These securities are known as Original Issue Discount (OID) bonds, since the difference between the discounted price at issuance and the face value at maturity represents the total interest paid in one lump sum.


Tax advantagesInterest income from Treasury bonds is exempt from state and local income taxes, but is subject to federal income taxes. Other components of your return, however, may be taxable when the bonds are sold or mature. If you buy a bond for less than face value on the secondary market (known as a market discount) and you either hold it until maturity or sell it at a profit, that gain will be subject to federal and state taxes. Buying a bond at market discount is different than buying a bond at Original Issue Discount (OID). When a bond has OID, the OID is treated as interest income. When a bond is purchased at market discount and held until maturity, the market discount is treated as interest income. When a bond is bought at market discount and sold before maturity, it may be subject to both interest income as well as capital gain or capital loss.


LiquidityLarge volumes of Treasuries are bought and sold throughout the day by a wide range of institutions, foreign governments, and individual investors so they are considered to be highly liquid. Investors considering Treasury securities have opportunities to buy bonds both at regularly scheduled auctions (see Auction Schedule) and in the secondary market, which is one of the world's most actively traded markets. Investors can find Treasury bills, notes, and bonds posted with active bids and offers. Spreads (the difference in price between the bid and offer) are among the most narrow available in the bond market. Investors should, however, be aware that at certain times, such as when important economic data is released, Treasury securities can be at their most volatile.


Credit or default riskInvestors need to be aware that all bonds have the risk of default. Investors should monitor current events, as well as the ratio of national debt to gross domestic product, Treasury yields, credit ratings, and the weaknesses of the dollar for signs that default risk may be rising.


the date on which the principal amount of a fixed income security is scheduled to become due and payable, typically along with any final coupon payment. It is also a list of the maturity dates on which individual bonds issued as part of a new issue municipal bond offering will mature


a bond where no periodic interest payments are made; the investor purchases the bond at a discounted price and receives one payment at maturity that usually includes interest; they have higher price volatility than coupon bonds as a result of interest rate changes


Learning how to buy bonds is an essential part of your education as an investor. A well-diversified portfolio should always strike a balance between stocks and bonds, helping you ride out volatility while still capturing growth along the way.


Buying individual bonds offers unique challenges. In addition to a wide range of moving parts inherent in each bond, the primary market can be difficult to access for all but the wealthiest investors. Meanwhile, the secondary market has less transparent pricing than primary issues.


The easiest way to buy bonds is to invest in bond mutual funds or bond exchange-traded funds (ETFs). Funds own large, diversified fixed-income portfolios comprising hundreds or even thousands of bonds.


Buying individual bonds via your brokerage account is more complicated. Typically online brokers offer access to bond secondary markets, which means that availability and prices wholly depend on existing holders looking to sell.


Information dealing with the purchase, redemption, replacement, forms, and valuation of Treasury savings bonds and securities is located on the TreasuryDirect.gov website which is managed by the Bureau of the Fiscal Service.


Yes, you can. When you file your tax return, you can tell the IRS you want to save part or all of your refund and have the rest sent to your checking account. You can save part or all of your refund by submitting Form 8888, Allocation of Refund (Including Savings Bond Purchases)PDF when you file your return. Follow the instructions on Form 8888 to tell the IRS to make a direct deposit of the amount you designate to an IRA, to buy U.S. savings bonds, to make a direct deposit to a savings or checking account or other savings vehicles, or to request a paper check.


No, you don't need to open an account in advance with the Treasury Department. Complete and file the Form 8888 with your tax return. The IRS will arrange for your U.S. savings bonds to be mailed to you.


No, you don't need to have a bank account to purchase I bonds with your federal tax refund. If you purchase I bonds with your tax refund, you can elect to have any remaining refund amount not used to purchase bonds mailed to you as a paper check.


You can use all or part of your tax refund to purchase I bonds. Your request for bonds must be in increments of $50. Any remaining refund amount not used to purchase bonds will be mailed to you as a paper check or you may elect to have the remaining amount direct deposited into a checking or savings account.


Series I U.S. Savings Bonds are sold under this program. They are a low-risk, liquid savings product that earn interest and provide protection from inflation. Although savings bonds are not marketable in that they cannot be bought or sold in secondary security markets, they can be redeemed for principal and accrued earnings at any time after 12 months. See details below.


You can buy savings bonds in increments of $50. You buy them at face value, meaning if you pay $50 using your refund, you get a $50 savings bond. This calendar year, you can buy up to a total of $5,000 in paper series I savings bonds with your refund. Any unused amount of your refund can be sent to you in a paper check, or you can elect to have the remaining refund direct deposited into an account of your choice.


Example: Bill is entitled to a $2,500 federal income tax refund. He decides to save $1,000 of the refund by buying savings bonds, to save another $1,000 by having the IRS direct deposit that amount to his IRA, and have the IRS direct deposit the remaining $500 to his checking account. Bill gives the IRS these instructions by completing Form 8888 and attaching it to his Form 1040. On the Form 8888, he checks the appropriate checking or savings boxes, gives the IRS the routing and account numbers for his IRA and checking accounts and completes the information specified in the Form 8888 instructions for the bond purchase. Six $50 savings bonds, one $200 savings bond and one $500 savings bond will be mailed to him.


Savings bonds are designed as longer-term investments, and generally cannot be redeemed during the first 12 months after you buy them, unless you live in an area affected by a disaster, such as a flood, fire, hurricane or tornado. Waivers for areas affected by disasters are announced on the TreasuryDirect.gov website. If you redeem a savings bond within the first five years, the three most recent months' interest will be forfeited. After five years, no penalty will apply.


Yes. Savings bonds purchased with a tax refund will be issued as paper bond certificates in your name. If you are married and filed a joint return, the savings bonds will be issued in your name and your spouse's name. If you purchase savings bonds for someone else, the bonds will be issued in the name(s) that you listed on Form 8888. 041b061a72


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