May 2005 and Later (EE Bond Rates and Terms)
On this page:
- What interest will I get if I buy an EE Bond now?
- When do my EE Bonds earn interest?
- How long do EE Bonds earn interest?
- Is there a penalty for cashing in early?
- When will my paper bond be worth its full value?
- Do I pay tax on the interest?
- When do I pay tax?
- How does Treasury decide on the interest rate?
- What have interest rates been since May 2005?
- When does my bond change rates?
The annual interest rate for EE Bonds issued between November 1, 2014, and April 30, 2015, is 0.10%.
EE Bonds issued after May 2005 earn interest for up to 30 years. They earn a fixed rate of interest. For the first 20 years, EE bonds earn the same fixed rate that was set when the bond was issued. We may change the rate or the way an EE Bond earns interest for the last 10 years of the bond's 30-year life. If we make a change, we have to do it before that 10-year period starts. (This is different from the type of interest that I Bonds earn. Comparing I Bonds to EE Bonds.)
EE Bonds earn interest from the first day of the month you buy them.
- Interest is added to the bond every month.
- The interest is compounded semiannually. Twice a year, all the interest that the bond earned in the previous six months is added to the main (principal) value of the bond. Interest in the next six months is then earned on the new value. In month 7, you earn interest on the original price + six months of interest.
(However, the value of an EE Bond that is less than five years old does not include the latest three months of interest. See "Is there a penalty for cashing in early?" further down this page.)
EE Bonds earn interest for up to 30 years
Yes, but only if you cash your bond within the first five years. You may cash in (redeem) an EE Bond after 12 months. However, if you redeem the bond in less than five years after its issue date, you do not get the last three months of interest. For example, if you redeem an EE Bond after 18 months, you get the first 15 months of interest.
You bought a paper EE Bond at half its face value. For example, you paid $50 for a $100 paper EE Bond.
The bond starts to earn interest on what you paid (not on its face value). Over time, with interest compounded every six months, the bond gets closer and closer to its face value.
Treasury guarantees that an EE Bond will be worth at least its face value after the first 20 years. If an EE Bond does not double in value (reach its face value) as a result of applying the fixed rate of interest for those 20 years, Treasury will make a one-time adjustment at the 20 year anniversary of the bond's issue date to make up the difference.
EE Bonds continue to earn interest for up to 30 years.
Electronic bonds are sold at face value (not half of face value). They start to earn interest right away on the full face value. Treasury guarantees that for an electronic EE Bond with a June 2003 or later issue date, after 20 years, the redemption (cash-in) value will be at least twice the purchase price of the bond. If the redemption (cash-in) value is not at least twice the purchase price of the electronic bond as a result of applying the fixed rate of interest for those 20 years, Treasury will make a one-time adjustment at the 20 year anniversary of the bond's issue date to make up the difference.
As owner of an EE Bond, you pay federal income tax, but not state or local income tax, on the interest the bond earns.
If you use the bond money to pay certain qualifying educational expenses, you may not have to pay federal income tax on the interest. Using EE Bonds for Education.
You may put off paying the tax until you file your Federal income tax return for the year you redeem the EE Bond. (A few exceptions are some situations in which we reissue or re-register the bond.)
You may also decide to pay tax on the interest every year. (This may be a good idea for bonds that a child owns.)
For more details: Tax Considerations for EE/E Bonds.
We determine the fixed interest rate for EE Bonds issued after May 2005 by
- taking the market yields of the 10-year Treasury Note, and
- adjusting that by the value of components unique to savings bonds, including options that permit early redemption (redemption after the first 12 months) and tax deferral.
We do this twice a year: May 1 and November 1. The new fixed rate of interest then applies to all EE Bonds bought in the following six months.
|Date the fixed rate was set for EE Bonds||Fixed rate for EE Bonds issued in the six months after that date|
|November 1, 2014||0.10%|
|May 1, 2014||0.50%|
|November 1, 2013||0.10%|
|May 1, 2013||0.20%|
|November 1, 2012||0.20%|
|May 1, 2012||0.60%|
|November 1, 2011||0.60%|
|May 1, 2011||1.10%|
|November 1, 2010||0.60%|
|May 1, 2010||1.40%|
|November 1, 2009||1.20%|
|May 1, 2009||0.70%|
|November 1, 2008||1.30%|
|May 1, 2008||1.40%|
|November 1, 2007||3.00%|
|May 1, 2007||3.40%|
|November 1, 2006||3.60%|
|May 1, 2006||3.70%|
|November 1, 2005||3.20%|
|May 1, 2005||3.50%|