EE savings bonds issued May 1997 or later increase in value every month. The bond's interest rate is compounded semiannually. The rate Treasury announces each May and November for these bonds is applied to a bond for the 6-month earning period.

If you cash such a bond before it's five years old, you give up the last three months worth of interest. For example, if you buy a bond in May 1997 and cash it 24 months later in May 1999, you get your original investment back plus 21 months of interest. The value of the bond would be based on the announced rates applied over the 21-month period from May 1997 to February 1999.

For Savings Bonds Bought Prior to May 1, 1997...

Savings bonds issued prior to May 1, 2026 generally earn interest every six months. It's a good idea to find out when your bond increases in value or when interest is paid so that you won't lose interest when cashing or exchanging them. For example, if your bond earns interest on August 1 and February 1, and you redeem or exchange your bond in July, you won't receive any interest for the five months since the last interest payment or increase in value (in this example, February). It's also a good idea to cash and exchange bonds early in the month in which they increase in value or pay interest because interest accrues and is paid on the first day of that month.

Regardless of When Your Bond Was Bought...

You can determine when your Series EE/E bonds and savings notes will increase in value using the information in When Your Bonds Increase in Value.

Always be aware of how long your EE/E bonds and savings notes earn interest and don't hold these bonds past their final maturity. You should also know that tax on the interest earned becomes reportable on your taxes in the year the bonds reach final maturity even if you don't cash them.

See also:

When Bonds Increase in Value
When Bonds Stop Earning Interest

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