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

Question

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.