FV = PV * {[1 + (i ÷ 2)](m/6)}
where
FV (future value) = redemption value on redemption date rounded to the nearest cent.
PV (present value) = redemption value at the beginning of the semiannual rate period
i = savings bonds rate converted to decimal form by dividing by 100.
m = number of full calendar months outstanding during the semiannual rate period.
Example, assume a hypothetical savings bonds rate of 5.00% effective May 1, 2002, for a bond denominated at $25, with an issue date of September 1, 1997 and a redemption value of $16.00 as of September 1, 2002. The February 1, 2003, redemption value is calculated as follows: Bonds issue dated in September have semiannual rate periods beginning each March 1 and September 1. The first semiannual rate period to begin on or after the effective date of the May 1, 2002, rate would be the period beginning September 1, 2002. PV, the present value, would be the value of the bond at the beginning of the semiannual rate period, on September 1, 2002. The savings bonds rate of 5.00% converted to a decimal would be 0.05. The number of months, m, is 5 since 5 full calendar months (September through January) have lapsed since the beginning of the rate period. FV is then the result of the formula:
FV = $16.00 * {[1 + (0.05 ÷ 2)](5/6)} = $16.33 after rounding to the nearest cent.
Using the example, the FV of a savings bond with a $50 or larger denomination can be determined by applying the appropriate multiple, for example: $16.33 * ($50.00/$25.00) for a bond with a $50.00 face amount; or $16.33 * ($100.00/$25.00) for a bond with a $100.00 face amount.
31 C.F.R. §351.32