What is a 'Series E Bond'

Series E Bonds were initially issued to finance the United States’ involvement in World War II. They were sold at a discount to face value and paid full face value at maturity. Series E Bonds remained available after the war as U.S. Savings Bonds and were replaced by Series EE in 1980.

Series E Bonds, first issued in May 1941 as defense bonds. The first purchaser of a Series E Bond was President Franklin D. Roosevelt. Series A through D was offered from 1935 to 1941. Series E became “war bonds” after the United States declared war on Japan in December of that year. 


Series E Bonds, sold as war bonds, were issued in denominations between $25 and $10,000. A war bond, initially known as defense bond, is a debt instrument issued by a government as a means of borrowing money to finance its defense initiatives and military efforts during times of war. 

Series E, war bonds were issued as baby bonds that sold for a minimum of $18.75 with a ten-year maturity. The bonds were zero-coupon bonds, meaning they did not pay regular interest but would pay the face value at maturity. They sell at a discount price of 75% of face value. E Bonds was initially issued with a fixed term of 10 years but were granted an interest extension of either 30 or 40 years, depending on the issue date. Large denominations of between $50 and $1000 were also made available.

War Bonds Through the Ages

During World War I, war bonds were Liberty Bonds and initially met with mixed success. The U.S. Treasury Department responded by enlisting celebrities to appeal to the American public’s sense of patriotism. The Series E campaign built on this success by marshaling the volunteer efforts of bankers, business executives, newspaper publishers, and Hollywood entertainers to support and promote the new bonds, which surpassed financial targets immediately. The initial drive aimed to generate $9 billion but exceeded that goal with income of $13 billion. The seventh drive raised the most substantial gross revenue of $26 billion over 48 days in 1945.

Following World War II, Series E Bonds became known as U.S. Savings Bonds. These bonds have become one of the most popular investments offered in the United States, as they provided the individual investor a safe, tax-free and affordable version of more substantial U.S. Treasuries or corporate or municipal bonds. They no longer offer a significant source of revenue for the U.S. government. The exchange of E Series bonds for H Series is allowed until  2004. That exchange is no longer offered. Instead, holders of mature Series E bonds can redeem them at financial institutions such as banks at an accrual value determined by the U.S. Treasury on a semi-annual basis. The final round of Series E Bonds stopped earning interest in 2010.

  1. U.S. Savings Bonds

    A U.S. savings bond is a government bond that offers a fixed ...
  2. Series I Bond

    Series I bond is a non-marketable, interest-bearing U.S. government ...
  3. Discount Bond

    A discount bond is a bond that is issued for less than its par ...
  4. Global Bond

    A global bond is a type of bond that can be traded in a domestic ...
  5. Corporate Bond

    A corporate bond is a debt security issued by a corporation and ...
  6. International Bond

    An international bond is a debt investment that is issued in ...
Related Articles
  1. Investing

    Surprise! The Best Long-term Bond Investment May Be Savings Bonds

    A 20-year Series EE savings bond pays more interest than a 20-year Treasury bond. So are government-issued long-term bonds the best bet going?
  2. Investing

    Corporate Bond Basics: Learn to Invest

    Understand the basics of corporate bonds to increase your chances of positive returns.
  3. Investing

    Time to cash in your U.S. savings bonds?

    If your U.S. Savings Bonds are dated 1984 or earlier, they've reached maturity and have stopped paying interest. Cash them in pronto and put that money to work!
  4. Investing

    U.S. Corporate Bonds: The Last Safe Place to Make Money

    There aren't many other sources right now for relatively safe, steady income.
  5. Investing

    How To Evaluate Bond Performance

    Learn about how investors should evaluate bond performance. See how the maturity of a bond can impact its exposure to interest rate risk.
  6. Investing

    Corporate Bonds: Advantages and Disadvantages

    Corporate bonds can provide compelling returns, even in low-yield environments. But they are not without risk.
  7. Retirement

    Should I Invest in Bonds After I Retire?

    Yes, retirees should invest in bonds, but remember that not all bonds are safe investments. Seek the help of a financial advisor.
  8. Investing

    The Basics Of Municipal Bonds

    Investing in municipal bonds may offer a tax-free income stream, but such bonds are not without risks. Check out types of bonds and the risk factors of muni-bond.
  1. What determines bond prices on the open market?

    Learn more about some of the factors that influence the valuation of bonds on the open market and why bond prices and yields ... Read Answer >>
  2. Why is my bond worth less than face value?

    Find out how bonds can be issued or traded for less than their listed face values, and learn what causes bond prices to fluctuate ... Read Answer >>
Hot Definitions
  1. Intrinsic Value

    Intrinsic value is the perceived or calculated value of a company, including tangible and intangible factors, and may differ ...
  2. Current Assets

    Current assets is a balance sheet account that represents the value of all assets that can reasonably expected to be converted ...
  3. Volatility

    Volatility measures how much the price of a security, derivative, or index fluctuates.
  4. Money Market

    The money market is a segment of the financial market in which financial instruments with high liquidity and very short maturities ...
  5. Cost of Debt

    Cost of debt is the effective rate that a company pays on its current debt as part of its capital structure.
  6. Depreciation

    Depreciation is an accounting method of allocating the cost of a tangible asset over its useful life and is used to account ...
Trading Center