Depending on how much money you are talking could change what investment is the best for your situation.
Right now savings bonds are giving .5 -1.9% on their face value and no monthly cash flow or quarterly dividends.
There are plenty of high quality companies handing out 3-5% returns from their dividend checks and if you implement dividend capturing with only the best of all the dividend companies, you could safely get double digit returns.
Of course you would need to do some research to see if this is some thing is right for you and your sister's situation.
The safest route I know of would be the Dividend Kings, most of these companies are over 100 years old and have weathered many market conditions over that time period. More importantly they have all increased their dividend pay-outs to their investors for a minimum of 50 years. Every year you and your sister would be getting more and more money. The safety net with companies that have a century or more track record and a half century of sharing profits with stock holders may be a good combination for you.
US savings bonds are used for this purpose all the time, but since this is not your child it will not save you any money when you cash them in, you will still pay on the interest earned
if you have enough to purchase municipal bonds they are tax free and if this will be several years the gain may be substantial for you
Start a 529 plan and buy equites (stocks) as you have a long time horizon to stomach market swings
Or should I take a different route? What are your feelings on bonds?