War bonds were the way the United States funded most major wars. The war bond was first used during the Revolutionary War to fund the Continental Army’s fight against Great Britain. These bonds were also largely used to fund the US’s war effort against Nazi Germany, and Japan in WWII.
War bonds work on two key principles: one they are sold at a discount and they provide no coupons.
When a bond is sold at a discount the consumer purchases the bond at a value less than face value. Upon maturity full face value is paid to the consumer. For example, the War bond might be purchased for $85.00, and in 10 years it will pay the investor $100.00. In WWII the bonds were purchased for $18.50 and maturated at $25.00.
Zero coupon means that on a 1, 5, 10, 20, and 30 year bond no annual interest is payed on the bond. To compensate for this principle, the bonds are sold at a discount below face value. In the modern world, zero coupon bonds are less attractive to investors because they do not generate steady income streams each year.
Currently the US has discontinued war bonds; however if the nation ever went to a conventional war with Russia or China, war bonds would be needed to help finance military operations. I can see a future where these bonds will be needed again, but let us hope and pray this never is the case.
Happy Independence Day America, and remember the importance of the War bond to our Independence.
Economic and Finance 
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