The interest earned on savings bonds purchased in 1990 and after may be used to pay for a child's college or trade education. This interest is exempt from federal income tax if the parents' adjusted annual gross income is tied to the cost of living index. Income limits apply in the year of redemption of the bonds and are adjusted annually. Partial exemptions also will be granted to parents who meet certain income requirements. Bonds are mailed directly to the bond owner by the bank.
Payroll deduction provides regular, automatic savings with no commissions or fees.
This campaign is the perfect time for employees to consider buying bonds or increasing their level of participation in the U.S. Savings Bonds program. I include their savings bonds with their birthday and Christmas gifts, and that way at least one gift lasts longer than a few weeks or a few months. Actually, my grandson is now 7 and already realizes that it is his savings account. I don't even have to think about it. Then when something comes up, I've got the money I've invested plus a little extra.