Financial Products Offered By Banks Are Likely Why Savings Bonds Are Being Snubbed.
Spring Lake Heights, New Jersey (PRWEB) July 17, 2014
Sales of U.S. Savings Bonds have been declining. Jack Quinn, Founder of SavingsBonds.com, speculates that the banking industry has played a part in the demise of savings bonds.
U.S. Savings Bonds were once a very popular, affordable, go-to investment for millions. They were an easy way for most to start investing for their future as well as a way to show patriotism by supporting America during times of war. Between 1941-1945 over $33 billion worth of bonds were sold. They were available at local banks, offered in denominations as little as $25 and were also widely promoted through payroll savings plans and marketed for the tax-free education exclusion. In 1992, $17 billion worth of savings bonds were sold. However, in 2013, sales have dwindled down to approximately $686 million.
Why are savings bond sales declining? Quinn, who has been an expert in the savings bond industry for 22 years, believes that banks want to sell their own financial products rather than savings bonds. They could also become more efficient refocusing employees training time on their own products and services rather than on (less profitable) savings bonds transactions. Additionally, by eliminating the sale of paper bonds (effective 2012) at their branches, individuals are now forced to purchase savings bonds electronically, making them a much less accessible and attractive investment option.
“Banks sell competitive financial products to savings bonds and make more money selling their own products,” says Quinn. He adds, “I also believe banks looked to eliminate the hassle of handling savings bond transactions.”
Many bond owners say that purchasing online is just too complicated and time consuming. They are now opting for alternative investments for themselves, for gifts and for their children or grandchildren. Unfortunately the elimination of paper bonds at banks is preventing future generations from learning what it is like to literally hold an American iconic investment in their hands.
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