These are links to information pages:I-Bonds: http://www.publicdebt.treas.gov/sav/sbiinvst.htmEE-Bonds: http://www.publicdebt.treas.gov/sav/savinvst.htm1)What, specifically, does "Market-Based Rate" mean?For EE-Bonds issued in May 1997 and later, the yield on EE-Bonds is based on 90% of the average yield of 5-year Treasury Notes for the 6-month period preceeding the announcement date (first day of May and first day of November). Whatever the most recently announced rate, a newly issued EE-Bond will yield that rate for six months. At every six months from month of issue, the rate will change to the rate of the most recent announced yield.There is also a 3-month interest penalty if the EE-Bond is redeemed within 5 years of month of issue. They cannot be redeemed within 1 year of month of issue unless the Bureau of Public Debt declares your area a disaster area.See http://www.publicdebt.treas.gov/sav/sav597ee.htm for how interest is calculated on EE-Bonds issued in May 1997 or later.The "Market-Based Rate" is thus referring to the average market returns of the 5-year treasury bonds, which are set by auction and by trade between auctions.2)Will the bonds I purchased maintain the same interest rate throughout their interest bearing period (30 years) or does it change according to current market conditions?No. The yield will be fixed for 6 months. Then at each 6-month interval it will change to the most recently announced yield for EE-Bonds. So the rate of EE-Bonds issued in May will change every November and May, the rate of EE-Bonds issued in June will change every December and June, etc.
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