|Vol. 17, No. 27||April 16, 1998|
Employees may purchase up to four bonds with different owners and with different purchase prices. Employees also are able to choose to have bonds deducted from their first pay, second pay or have two deductions per month. During the campaign employees may purchase bonds or increase current bond allocations through payroll deduction.
Savings bonds have a number of attractive features, including a competitive interest rate, government guarantee of principal and interest, protection from loss or theft, exemption of earned interest from state and local income taxes and the sheltering of earned interest from federal income tax until funds are withdrawn.
Interest on Series EE bonds is compounded semiannually. The current interest rate is 5.59 percent.
The interest earned on savings bonds purchased in 1990 and after may be used to pay for a child's college or trade education.
This interest is exempt from federal income tax if the parents' adjusted annual gross income is tied to the cost of living index. Income limits apply in the year of redemption of the bonds and are adjusted annually. Partial exemptions also will be granted to parents who meet certain income requirements.
Savings bonds come in denominations that fit every budget, from $100 to $10,000, and they cost just half of the face value, so purchase prices start as low as $50.
The University purchases bonds from the bank once a month when employees have accumulated enough for a bond ($50 for $100 bond, $100 for $200 bond, etc.). Bonds are dated the month of purchase; the effective date for the first bond issued in this drive will be July 1, 1998.
Bonds are mailed directly to the bond owner by the bank. Payroll deduction provides regular, automatic savings with no commissions or fees.
This campaign is the perfect time for employees to consider buying bonds or increasing their level of participation in the U.S. Savings Bonds program.
U.S. Savings Bonds applications can be obtained from Personnel Records, 87 East Main Street.
Employees with questions about the U.S. Savings Bonds program should contact Joyce Dennis Henderson, manager of employee services, telephone 831-2171 or visit www.udel.edu/EMPSERVICE/Savbond/Sbonds.html