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InvestHub.com's
Finance Dictionary and Glossary of Investment Terms

Savings Bonds  

Definition 1.

Savings bonds are like Treasury bonds, except even the smallest investors can buy them. They come in small denominations, are absolutely safe with respect to payment of interest and principal, and involve no transaction costs. The government issued Series E bonds from 1941 until 1979. In 1980, it began issuing Series EE and Series HH bonds.Interest earned from savings bonds is exempt from state and local taxes. You must pay federal tax on the earnings, but you have the option of deferring these taxes until the bond matures.
 
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