Bond Calculator
Calculate bond yield, return, and income. See your yield to maturity (YTM), current yield, and total coupon payments.
Principal amount returned at maturity (usually $1,000)
Annual interest rate paid by the bond
Time until the bond matures
Market price you pay for the bond (can be above or below face value)
How often coupon payments are made
What is a bond and how does it work?
A bond is a loan you give to a government or corporation. In return, they pay you interest (coupon payments) at regular intervals and return your principal (face value) at maturity. Bonds are considered safer than stocks but typically offer lower returns. Common types include Treasury bonds, municipal bonds, and corporate bonds.
What is the difference between coupon rate and yield?
Coupon rate is the fixed annual interest paid by the bond, expressed as a percentage of face value. Yield (or yield to maturity) is your actual return if you buy the bond at current market price and hold to maturity. If you buy below face value (discount), yield > coupon rate. If you buy above face value (premium), yield < coupon rate.
Should I buy bonds or bond funds?
Individual bonds offer predictable income and return of principal at maturity, ideal if you can hold to maturity. Bond funds offer diversification and liquidity but have fluctuating values and no maturity date. Funds are better for smaller investors ($1,000-$10,000). Individual bonds work for larger amounts ($10,000+) and specific income needs.
Are bonds safe investments?
Bonds are generally safer than stocks but not risk-free. U.S. Treasury bonds are virtually risk-free. Corporate bonds carry credit risk (company default). All bonds have interest rate risk - when rates rise, bond values fall. Municipal bonds offer tax advantages. Always check bond ratings (AAA is highest, below BBB is "junk").