From: http://www.app.com/news/app/story/0,2110,434793,00.html

Profile: Money can be made in savings bonds

Published in the Asbury Park Press 8/19/01

By DAVID P. WILLIS
BUSINESS WRITER

Jack Quinn got a surprise about eight years ago when he checked out some U.S. Savings Bonds he found in a tin. His local bank told him how much they were worth. But they didn't know the interest rate or how long interest would accrue. Over time, he and his son, Jay, went to about 125 banks. "I got a lot of 'I don't knows,' " Quinn said. About one-third didn't have correct information about the values either, he added. From that experience came U.S. Savings Bond Consultant, a Wall-based business that helps people track the value of savings bonds and supplies information about them. Fifty-five million Americans own more than $187 billion in U.S. Savings Bonds, which are Treasury securities. About $7.5 billion-worth of them have stopped earning interest.

Many people don't have information about the bonds they own. "It is confusing," said Quinn, who is chief operating officer of the business. "There are people with literally hundreds of thousands of savings bonds and they don't know the first thing about them." Quinn knows what it's like. After his experience with the banks, he started his quest for government publications and information about savings bonds. He realized there was a business opportunity. "I had to take that information and distill it," Quinn said. "It was a very lengthy and painstaking process."

Quinn learned the ins and outs of savings bonds, a field with rules and changes. For instance, a bond purchased in November 1965 will earn interest for 40 years. A bond purchased a month later would earn interest for just 30 years. "It is easy to buy," Quinn said. "It is one of the most difficult things to understand because the rules don't stand still."

The details suited Quinn, a software programmer and systems analyst. Quinn had founded Union Information Services in 1973, a company that designs and develops financial software for labor unions nationwide. U.S. Savings Bond Consultant became a subsidiary. In 1995, Quinn released software designed to, among other things, calculate current values and list current interest rates and total interest earned. Quinn hoped to market it to banks. But that didn't work out. He called on banks, sent letters and gave demonstrations. Bureaucracy made it impossible, Quinn said. "Bottom line, I never made a sale to a bank," Quinn said.

So instead, he started targeting the consumer market, contacting personal finance publications, computer magazines and financial planners. Quinn realized he had a good concept after the software was featured in a 1996 article in Modern Maturity magazine, the official magazine of the AARP. "That made believers out of us," Quinn said. "The response from that article was so huge, we had thousands of people calling us." The company also started to offer a service for people who didn't have a computer. Customers could telephone the company, provide them with information, and get a report on their savings bonds in the mail.

In 1997, Quinn upgraded his software, called Bond Manager, and gave people the ability to create a database of their bonds. The earlier version only allowed users to get information on one bond at a time. "Now it was no longer tedious for them," Quinn said. People purchased upgrades every year containing updated rates and government formula changes.

That year, he also started a Web site at www.savingsbonds.com as an information source about bonds, including government forms and tips on how to buy and sell bonds. Software users were able to download program changes and new forms online, saving the company money.

"We felt it was another avenue for selling our software," Quinn said. "Everyone and their brother was going to the Internet." Quinn started to move away from his union business to concentrate more on savings bonds. Earlier this year, the company created The Bond Guru, which allows users to manage their bonds on the Internet, for $11.95 a year. In the last six months, about 400 people have signed up for the Guru, Quinn said. And thousands have come to the Web site, many signing up for a trial period.

The company, which has seven full-time employees, is profitable, Quinn said. Sales for the savings bond portion of the business have grown to replace and overtake revenues from the labor union business, which is being phased out, he said. Quinn sees growth potential for the Internet. Banks don't offer information about savings bonds. They are sending people to the company's Web site for information on their bonds, he said. And people now have access to the latest figures and rate changes without having to download new charts, Quinn said.

"We change our program so people are always operating with the more recent version" online, Quinn said. "In the long run, it will be much less expensive to our clients as well as ourselves." Now the company is looking to partner with financial services companies or brokerage firms to help people reposition their savings bonds investments.

 People say "I have these bonds, what should I do with them?" said Jackie Brahney, marketing director. "You don't stick them in a drawer anymore," she said. "You should be managing your bonds."