Illinois College Savings Bonds are tax-exempt, zero-coupon bonds issued by the State of Illinois. These bonds are issued by the State to provide individual investors with a long-term investment to help fund college expenses. Since January 1988, the State has issued 12 series of the bonds with a total maturity value of $4 billion. Thousands of Illinois families have invested in College Savings Bonds to save for their children’s future college expenses. Sales are typically held in the fall.
These bonds are structured as zero-coupon bonds and pay no interest until maturity. Each bond is priced at a discount so that the original principal amount plus the accrued interest equals $5,000 at maturity.
Illinois College Savings Bonds are general obligation bonds of the State of Illinois. The State’s full faith and credit is pledged for the punctual payment of principal and interest on the bonds. The monies received by the State from the sale of the bonds are used to support the State’s capital program.