UpDate - Vol. 12, No. 27, Page U.S. SAVINGS BONDS - 3
April 15, 1993
U.S. Savings Bonds
U.S. Savings Bonds offer 4% guaranteed interest

Highlights, Series EE bonds, issued on or after March 1, 1993

       * Market-based rate applies to EE bonds held five years or longer,
         if it averages higher than 4.0 percent.
       * Guaranteed interest rate is 4.0 percent no matter how long you
         hold the EE Bond, from six months up to 18 years. Bonds continue
         to earn interest for 30 years or until cash.
       * Interest is added to the value of the EE Bond every month from the
         sixth month through 18 years from issue. Redeem or exchange for
         HH bonds in any month without loss of interest.

Series HH bonds

       * Interest is paid semiannually at a fixed 4.0 percent annual
         percentage rate for the first 10 years from issue. HH bonds
         continue to earn interest for 20 years from issue.

Older EE and E bonds

       * Older bonds continue to receive interest every six months; EE
         bonds issued through February 1993 receive interest monthly from
         the sixth through the 30th month from issue. Bonds issued before
         March 1993 will retain their existing guaranteed minimum rates
         until they enter a new extended maturity period. Their guaranteed
         rate will be 4.0 percent during extended maturity periods that
         begin in March 1993 or later.

     Savings bond interest accruals: Series EE U.S. savings bonds that are
     held at least five years from issue pay a variable market-based rate
     or a guaranteed minimum yield, whichever is greater. For savings bonds
     issued on or after March 1, 1993, the guaranteed yield is 4.0 percent
     from issue through 18 years from issue. Interest is compounded
     semi-annually from the date of issue and accrues monthly through 18
     years from issue.
 
     Maturity: Series EE savings bonds issued on or after March 1, 1993,
     have an initial term of 18 years. All Series EE bonds earn interest
     until final maturity, 30 years from issue. New EE bonds will receive
     one 10-year and one two-year extended maturity, at the guaranteed
     rates in effect when those extensions begin, for a total of 30 years.
 
     Bonds held less than five years from issue: Bonds redeemed at any time
     beginning six months from issue, until five years from issue when they
     become eligible for market-based interest, earn interest at a 4.0
     percent annual percentage rate, compounded semiannually from the date
     of issue. Interest accrues monthly.