Question

What is occurring when you buy a United States Savings Bond?


You are loaning money to the government.


You are donating money for special government projects.


You are borrowing money from a savings and loan association.


You are paying for your child’s college education.

Answer 1

When you buy a United States Savings Bond, **you are loaning money to the government**. Savings bonds are debt securities issued by the U.S. Department of the Treasury, and when you purchase one, you are essentially providing a loan to the government, which it will pay back with interest over time.