At a time when stock prices and bond yields have plummeted, there’s a way to double your money without taking risks.

It’s the old-fashioned series EE US savings bond. Keep it for 20 years, and it guarantees that you will get back at least double your investment. That’s the equivalent of a 3.53% annual yield, far better than what other low-risk ­investments have been yielding. Income from EE savings bonds is state and local tax–exempt…and federal taxes are deferred until you redeem the bonds (or after 30 years when the bonds reach final maturity). It also may be federal tax–exempt if you use it to pay qualified higher education expenses.

But there’s a catch—redeem these bonds before 20 years, and the annual yield is just 0.1%. The Treasury makes a onetime adjustment on the 20th ­anniversary of the purchase month, increasing redemption value to twice the purchase price. (These bonds cannot be redeemed for the first year following purchase, and modest penalties apply if they’re held for less than five years.)

There’s also a cap—you can’t buy more than $10,000 of EE savings bonds per year. A couple can double that by buying bonds under each partner’s name. A family could buy bonds under minor children’s names, too, but the bonds will become property of those children and are not eligible for the education tax break. 

What to do: Purchase EE savings bonds through TreasuryDirect.gov only if you’re confident that you won’t need the money for 20 years. Redeem as soon as the redemption value is adjusted at the 20-year mark—the annual yield is just 0.1% after that. Include instructions in your estate plan noting when these bonds should be sold and why that sale date makes sense.