Major, rather than my re-writing the info available, here are some
very good, succinct links on I vs EE Bonds:
-I vs EE comparo:
http://www.dfas.mil/navy2/investment...svsibonds.html
-Fed site on Bonds:
http://www.sec.gov/answers/savingsbond.htm
-Verf good site, but one must hit links to see I Vs EE, and has
handy bond interest calculator:
http://www.savingsbonds.com/
Short answers to your questions, imo:
1-EE offer a "fixed" interest return, re-set twice per year over the
life of the bond/length of time you hold them.
2-Both types of bonds are currently exempt from all state & local
taxes, but not Fed taxes. Fed taxes not due until bond is cashed or
at bond maturity end.
3-Current rule is $20,000 worth of each type, per person
per year,
though one has to split the buys using electronic purchase for aprox
half of each species. There is no current limit on how many years'
worth of this total one can buy, though the annual total is down from
about $60Gs a yearish ago.
4-Safe? The "safest" investment on the planet is US backed bonds,
TBills, etc. Seldom the best paying, but literally the "safest", though
I don't lose any sleep over CDs, either.
I Bonds vs EE Bonds may offer you a slight advantage, as their interest
is re-set based upon US Gov't "inflation" rates; however, to complicate
the comparo, EE Bonds reset interest twice per year, also...
Strictly imo, TIPs bonds may be better than I Bonds, over the long haul,
as they sell on open mkt, usually offer a more appealing interest rate,
(albeit one set by the "mkt", not the Fed), etc.
TIPs, and many Fed bonds, are really instruments to hold in a tax deferred
acct., eg a 401K or IRA or Roth IRA, imo. TIPs and annual interest paying
instruments should/could be sheltered in that tax deferred account.
With all that said, I assume you are a fairly young man; thus, barring
the apocalypse, you have time on your side with all your investments.
I would not offer other advice or opins as I am not a registered CFA;
just a retired bum.
GL,mD