U.S. Savings Bonds are a popular and low-risk investment method dating back to 1935. Historically, the bonds were used to help fund the WWII war efforts, but now are a useful tool for college education payment or retirement savings. Savings bonds accrue interest at either a fixed or adjustable rate for a specified period of time until they reach full maturity.
Savings bonds are non-transferrable. Only the person named as the owner of a bond can redeem it. If you have received a bond as part of an inheritance, special documentation is required to prove you are the rightful owner. Instructions on how to redeem savings bonds after the death of the owner can be found on the Department of the Treasury's TreasuryDirect website.
If you've purchased a U.S. Savings Bond from an individual, auction, or website, you are not the lawful owner. You will not be able to redeem the bond.
Series of Bonds
The rates, maturity periods, and terms of bonds differ by bond series and issue date. Knowing the specific terms of your bonds allows you to maximize your redemption.
Series - Series E bonds were discontinued in 1980. All Series E savings bonds have reached full maturity and no longer accrue interest.
Series EE - Series EE bonds can be redeemed when they are at least 12 months old from date of issuance. If Series EE savings bonds are redeemed within the first 5 years from issuance, the owner forfeits the last three months of interest. Series EE bonds accrue interest for 30 years before reaching full maturity; only some have reached full maturity.
Series H - Series H bonds were discontinued in 1979. All Series H savings bonds have reached full maturity and no longer accrue interest.
Series HH - Series HH bonds have interested paid every six months after issuance and do not pay interest on a partial six-month period. To maximize earnings on Series HH savings bonds which still accrue interest, redemption should be done shortly after an interest payout (for example, an HH bond issued in June will pay out interest on June 1 and December 1). Series HH bonds were discontinued in 2004 and accrue interest for 20 years before reaching full maturity; only some have reached full maturity.
Series I - Series I bonds Series I bonds can be redeemed when they are at least 12 months old from date of issuance. If Series I savings bonds are redeemed within the first 5 years from issuance, the owner forfeits the last three months of interest. Series I bonds were introduced in 1998 and accrue interest for 30 years before reaching full maturity; none have reached full maturity.
Electronic or Paper Bond Redemption
Electronic savings bonds first became available in 2002 and have almost completely replaced paper bonds. Electronic bonds can only be redeemed through the TreasuryDirect website. To redeeem, log in to your TreasuryDirect account and follow the directions to have money deposited to your bank account. Electronic bonds can be redeemed in whole or in part. A partial redemption of a bond requires a pay-out of at least $25, and must leave at least $25 in your TreasuryDirect account.
There are two ways to redeem paper savings bonds. First, visit your local bank. You must sign the section of the bond labeled "request for payment" and bring identification. The bank will cash the proceeds of your bonds. Some banks may have restrictions, including some which do not cash bonds at all. The bank may require you to have an active account for at least six months before redeeming savings bonds, while others may allow you to redeem a limited amount of bonds without an account.
Bonds can also be redeemed by mail. Your signature in the "request for payment" section will need to be verified by a certifying officer at your bank. Mail the bond, your social security number, and a cancelled check or direct deposit sign-up form to:
Treasury Retail Securities Site
PO Box 214
Minneapolis, MN 55480-0214
To find out the value of your bonds, get the direct deposit sign-up form, or convert paper bonds to electronic, visit treasurydirect.gov