An Old Favorite: Savings Bonds
Savings bonds—the kind you received from your grandparents when you were a kid—can actually be a great option for the average investor. Like treasuries, savings bonds are backed by the full faith and credit of the United States government.
Patriot Bonds (Formerly EE Savings Bonds)
Following the events of September 11, 2001, EE Savings Bonds were renamed Patriot bonds. They are purchased for half of their face value (e.g., a $10,000 savings bond will cost you $5,000) and come in denominations of $50, $75, $100, $200, $500, $1,000, $5,000, and $10,000. Patriot Bonds, a type of zero-coupon bond, are simple, straightforward, and absolutely safe. There are some disadvantages, however:
• The yield is fixed at 90 percent ...