Part 1: Overview of Savings Bonds
Part 2: Pitfalls and Risks of Savings Bonds
Part 3: How to Buy Savings Bonds
Savings bonds are really easy to buy. Traditionally you would walk into almost any bank, credit union, or savings and loan to buy savings bonds. Starting in 2012, things changed: you can now only buy savings bonds online or with your tax refund. However, you can still redeem paper savings bonds at many banks and credit unions.
TreasuryDirect.gov – Buy Savings Bonds Online
The Treasury Department has a nice website for buying savings bonds. The process is easy and fast. If you’re internet-savvy, you can be the proud owner of a savings bond in less than 10 minutes. If you’re still figuring things out online, it may take 20 minutes.
Honestly, I was amazed at how easy the site is – in fact I’m a little concerned about it.
First you’ll create an account which they verify via email. You just type in some basic personal information. You also link a bank account to your TreasuryDirect account (no verification required). It seemed like they aren’t taking security as seriously as many of the online banks when you set up a link. Of course, it is the government so presumably they have the power to fix any mistakes.
Once you’re logged-in, you can buy a variety of Treasury securities. There is even a “Purchase Express” form on the welcome page. You can simply enter a bond-type and dollar amount and you’re off.
In my opinion, the Treasury should do a better job of verifying orders to purchase these securities. You have to do a lot of digging to find the fine print that details minimum holding periods and cash-out penalties. Be sure you understand what you’re getting into before you do anything on that site.
