Does anyone know how to calculate how much interest I would forfeit on 30-year EE bonds if I redeem them two months before they mature?
Thank you!
Answers
Source: https://www.treasurydirect.gov/savings-bonds/ee-bonds/
1) "original maturity" for a 30-year EE bond (issued after June 2003) is at 20-years (when your principal is guaranteed to double)
2) "final maturity" for a 30-year EE Bond is reached at 30-years.
two months before either maturity date is beyond the 5 year penalty period for cashing out early, so you would forfeit nothing in terms of interest as a result.
However, if you mean how much less in interest you get from not waiting those final two months to maturity, that's a more complex question.
If your bond is currently 2 months away from the maturity you are asking about, the easiest answer is to simply use the bond calculator at TD and plug in the two dates.
https://treasurydirect.gov/BC/SBCPrice
If the bonds are currently years away from the maturity in question, however, the answer isn't so simple. You need to know what the interest rates involved are, and that varies depending on when you bought the bonds. EE bonds issued since 2015 have a fixed 0.10% rate for the first 20 years, older bonds have different rates, In addition, the treasury may change the interest rate or the way the EE bond earns interest for the last 10 years of the bond's 30-year life (if they do that, they have to announce the change prior to the 20 years is up).