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© Copyright Savingsbonds.com | UIS Inc. – May 2007 Welcome to SavingsBonds.com’s MAXIMIZING YOUR SAVINGS BOND INVESTMENT WEBCAST Questions can be submitted using the Q&A button at the bottom right or by at Your speaker today is… Jack Quinn Savings Bond Expert
© Copyright Savingsbonds.com | UIS Inc. – May 2007 Topics we’ll cover today... Savings Bond Series Which Bonds to Hold, Which to Cash In Best Time to Cash In YOUR Bonds The Difference Between Initial and Final Maturity Unpleasant Tax Surprises This Savings Bond Educational Experience is being brought to you by
© Copyright Savingsbonds.com | UIS Inc. – May 2007 Savings Bonds in Circulation No Longer Available Series E Series H Series HH Baby Bonds A thru K Freedom Shares aka Savings Notes Currently Available Series EE aka “Patriot Bond” Series I
© Copyright Savingsbonds.com | UIS Inc. – May 2007 Expert’s tip on EE and I Bonds Can redeem both EE an I bonds only AFTER 12 months old UNLESS your county is declared a “Federal Disaster Area” Ex. Communities affected by Hurricane Katrina 3-month interest penalty if the bond is redeemed during first 5 years
© Copyright Savingsbonds.com | UIS Inc. – May 2007 Paper EE Savings Bonds Purchase at half of face value i.e. pay $50 for a $100 bond Denominations: $50, $75, $100, $200, $500, $1,000, $5,000, and $10,000 Bond worth its face value when it reaches “initial” maturity Bonds purchased May 2005 & after have two major rule changes: Int. % Rate FIXED for first 20 years, with extension of 10 years Guaranteed to reach face value by 20 th year $30,000 maximum cash-purchase in one calendar year ($60,000 face value)
© Copyright Savingsbonds.com | UIS Inc. – May 2007 Paper I Savings Bonds Purchased at face value: i.e pay $100 for a $100 bond Denominations: $50, $75, $100, $200, $500, $1,000, $5,000, and $10,000 $30,000 maximum cash-purchase in one calendar year ($30,000 face value)
© Copyright Savingsbonds.com | UIS Inc. – May 2007 EE Bond Interest Rates For EE Savings Bonds Purchased… April Or Earlier Rate before May 1995 earn interest depends on their issue date Before five years old, earn interest based on fixed graduated scale, except bonds issued March 1993-April 1995 earned a fixed rate of 4% May April 1997 Earn interest based on market yields for U.S. Treasury securities Bonds earned two savings bond rates: a short-term rate and a long- term rate MAY 1997 –April 2005 Earn variable market based Rate based on 5-year Treasury security yields May 2005 – Today Fixed Rate for first 20 years May Adjust for final 10 years Rates as of May EE BONDS: 3.40% I BONDS: 3.74%
© Copyright Savingsbonds.com | UIS Inc. – May 2007 I Bond Interest Rates Increase in value monthly - interest is paid when bond is redeemed Increase in value with inflation-indexed earnings Rate is combination of fixed rate and an inflation rate based on CPI-U Interest compounds semiannually for 30 years This Savings Bond Educational Experience is being brought to you by
© Copyright Savingsbonds.com | UIS Inc. – May 2007 Confused??? When is the best time to cash in your bonds? How do you avoid costly mistakes with your savings bonds? How does the average investor make dollars and sense of the Savings Bond Market? Where can you find all the rules, values, interest rates all in one place? LETS ADDRESS THESE IMPORTANT QUESTIONS!
© Copyright Savingsbonds.com | UIS Inc. – May 2007 Which to hold, which to cash in *Expert Tips – The Three Biggest Mistakes Cashing in a bond without knowing interest rates Cashing in bonds based on purchase date Forfeiting up to 6 months worth of interest It was once reported by the Treasury Department that $150 MILLION in interest is forfeited every year by cashing in bonds at the wrong time
© Copyright Savingsbonds.com | UIS Inc. – May 2007 How to Maximize Cashing In Bonds post interest as of the first of the month and remain at that value throughout the month If a bond only posts interest every 6-months, be sure to hold it until the next interest posting date – or you may forfeit the prior 6 months of interest! When is the interest posting date for my bond? See the Savings Bond Guru Trial at the end of this webcast
© Copyright Savingsbonds.com | UIS Inc. – May 2007 Savings Bond Maturity Dates $15,000,000,000 There are over $15,000,000,000 In Savings Bonds that have reached FINAL Maturity and SHOULD HAVE been cashed in! What is “Final” maturity? How do you know when your specific bonds have reached “Final” Maturity?
© Copyright Savingsbonds.com | UIS Inc. – May 2007 The Difference Between Initial and Final Maturity Initial Maturity When a paper bond reaches it’s FACE value printed on bond Final Maturity When a bond STOPS earning interest *Expert Tip: The IRS REQUIRES you report the interest as of the final maturity… Currently EE and I Bonds reach Final Maturity at 30 Years EVEN IF YOU DO NOT CASH IN THE BOND!!!
© Copyright Savingsbonds.com | UIS Inc. – May 2007 Taxation - EE and I Bonds Exempt from state and local income tax Financial institution where you cash in your bonds will report your interest earnings to the IRS IRS Form 1099-INT goes to you and the IRS when a bond is cashed *Expert Tip: Watch out for the Tax Surprise When redeeming a bond, the difference of purchase price to cash in value (which can be 4 to 6 times it’s face value) is reported as interest income
© Copyright Savingsbonds.com | UIS Inc. – May 2007 Find out what you need to know… The Savings Bond Guru a service of SavingsBonds.com Let’s take a look at the Savings Bond Performance Report…
© Copyright Savingsbonds.com | UIS Inc. – May 2007 How do I get a free Savings Bond Performance Report for my bonds? Go to Click on the red button “FREE TRIAL”!
© Copyright Savingsbonds.com | UIS Inc. – May 2007 We will now take your questions about your Savings Bonds You can submit your question either by to OR by using the Question button in the lower right of your screen…
© Copyright Savingsbonds.com | UIS Inc. – May 2007 Thank you for attending
© Copyright Savingsbonds.com | UIS Inc. – May 2007 See you at the next webcast… Next Wednesday – June 13 1PM & 4PM Eastern! This Savings Bond Educational Experience is being brought to you by
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