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Savings Bonds for Kids

What is a savings bond?

Savings bonds are considered a good way for adults to save money without the risk of the money losing any value like it happens, sometimes. To put it simply, savings bonds represent a more secure way of saving money. It starts with a person buying a bond from the government. There are two types of bonds. The first type, called Series EE, is bought and then gains interest for 30 years. Series HH bonds are sold similarly but they are worth what was paid for them.

What does a savings bond look like and where do you get them?

Savings bonds actually have the faces of famous Americans on them! Helen Keller is on the $50 bond, Martin Luther King Junior is on the $100 savings bond, Chief Joseph is on the $200 bond, and Marian Anderson is on the $5,000 savings bond. There used to be a $10,000 savings bond with Spark Matsunaga on it, but it is unavailable now. To buy a bond, you have to go to special places. There is a website too. However, most people go to either big banks or similar financial places because they feel it’s safer.

Who owns bonds?

Who actually owns the bond depends on how the bond is registered with the government. You can purchase a bond and designate a “beneficiary.” If the first owner dies, the beneficiary will own the bond. There are also bonds you can buy with two different owners as long as you go through the proper registration. Even minors can own savings bond so it’s not a problem.

How much money can people get from savings bonds?

The actual amount you redeem from savings bonds depends on the type. With certain types, you can only get the face value of the bill. With others, you earn interest over a 30-year period. The final sum varies according to interest rate changes.

Why do people buy savings bonds?

People buy savings bonds because they are one of the safest ways to save money. Unlike other types of savings accounts, once you buy a savings bond from the government, it can’t be bought or sold at all. All that happens is that it gains interest, which means as time goes by, it becomes even more valuable so when you’re ready to redeem the savings bond, it’s worth more money than the original sum you paid for it. Some people even call it a “loan to the government.”

Savings bonds used to be awarded to people who bought cemetery plots, cars, and even household appliances. They can also be replaced if they’re damaged. President Roosevelt was the very first one to order the $5,000 bond in 1941. Today, around 55 million people own savings bonds.

How can kids earn money?

There are lots of ways for kids to earn and save money. They can do chores, save birthday money, even do things like sell lemonade or drawings to earn cash. All it takes is a little effort. Saving money is essential in today’s world so that if you need money when you’re older, you already have it, which is a luxury many people don’t have!