The perfect companion to zero-percent financing — zero-percent savings:
The U.S. Treasury Department set a zero percent earnings rate Friday for its Series I savings bonds bought from May through October 2009.
The earnings rate includes a fixed rate, set at 0.1%, and the annualized rate of inflation over the next six months, which was -5.56% between September 2008 and March 2009. The earnings rate is never less than zero.
Chances are there are a lot of you out there who have have purchased savings bonds in the past but have forgotten all about them. According to the Bureau of the Public Debt, there are 40 million matured Series E Savings Bonds still in circulation. The Treasury Department estimates the worth of these bonds purchased between 1941 and 1978 to be $16 billion.
So why has this easy source of cash been so under utilized? While many have been thought to be either destroyed or the property of the deceased, a main reason continues to be that holders wish to avoid paying taxes on the interest.
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