Taylor Scott
Savings bonds are a low-risk way to save money, and they can be redeemed through the Federal Reserve. Banks are not required to redeem savings bonds for non-customers, and the Secret Service recommends that a customer be established for 12 months before cashing bonds at a financial institution. Most banks will redeem savings bonds if you have a relationship with that bank. Bonds can be redeemed if the owner or co-owner's name has changed, but only if the name change is obvious, like a shortened first name, maiden name, or married name. To redeem savings bonds, individuals must be 18 or older with a valid Social Security number, U.S. bank account, and U.S. address. Bonds can be cashed in after a single year, but there is a penalty for cashing them within the first five years.
| Characteristics | Values |
|---|---|
| Who can redeem savings bonds? | Individuals, banks, the Treasury Retail Securities Site at the Federal Reserve Bank of Minneapolis, and heirs of the deceased bondholder. |
| Requirements for redemption | Bonds must not be altered or defaced. Bondholders must provide proof of identity and may need to fill out forms and get their signatures certified. |
| Timeframe for redemption | Bonds can be redeemed after one year, but there is a penalty for cashing in within the first five years. |
| Interest | The longer the bond is held, the more it earns. Bonds generally mature after 30 years. |
| Purchasing | Only electronic bonds can be purchased now, but paper bonds can still be cashed in. |
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What You'll Learn
- Most banks will redeem savings bonds if you have a relationship with them
- Financial institutions can refuse to cash savings bonds for non-customers or new customers
- Bonds can be redeemed if the owner's name has changed, e.g. maiden name
- Bonds can be redeemed to the estate of the last decedent
- Paper savings bonds can be cashed if they've reached their term limit
Most banks will redeem savings bonds if you have a relationship with them
Savings bonds are a low-risk way to save money, and they are available in denominations ranging from $25 to $10,000. Anyone who is 18 or older with a valid Social Security number, U.S. bank account, and U.S. address can purchase savings bonds.
If you have a paper E/EE or I bond, you will need to provide proof of identity, such as a United States driver's license, and partner with a notary to notarize and certify your signature on an unsigned FS Form 1522. You can then take these to your local bank or credit union.
For redemption or other information about U.S. savings bonds, you can visit the U.S. Treasury Department's website or contact their office directly by calling (844) 284-2676 (toll-free).
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Financial institutions can refuse to cash savings bonds for non-customers or new customers
Financial institutions are not required to redeem savings bonds for non-customers or new customers. Banks are allowed to refuse to cash savings bonds for non-customers or new customers. Most banks will only redeem savings bonds if you have a relationship with the bank. The Secret Service recommends that a customer be established for 12 months before cashing bonds at a financial institution.
To redeem a savings bond, you will need to provide proof of identity, such as a United States driver's license, and partner with a notary to notarize and certify your signature on an unsigned FS Form 1522. You can take these documents to your local bank or credit union.
It is important to note that savings bonds are only available to be cashed in after a single year. However, if you cash in the bond in less than 5 years, you will lose the last 3 months of interest. The longer you hold the bond, the more it earns for you (up to 30 years for an EE or I bond).
If you are unsure about whether or not your bank will redeem your savings bond, it is best to contact them directly to inquire about their specific policies.
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Bonds can be redeemed if the owner's name has changed, e.g. maiden name
Bonds can be redeemed if the owner's name has changed, for example, from a maiden name to a married name. If the name change is obvious, such as a shortened first name, maiden name, or married name, the owner must re-sign the bond, provide an explanation for the name change, and proceed with the redemption. This process can be completed at a bank branch. However, if the name change is not obvious or the explanation is unsatisfactory, the bank may choose not to cash the bond. In such cases, the bond should be forwarded to the Treasury Retail Securities Site at the Federal Reserve Bank of Minneapolis for further processing.
It is important to note that financial institutions are not required to cash savings bonds for non-customers or new customers. Most banks will redeem savings bonds only if the customer has an established relationship with the bank. The Secret Service partners recommend that a customer be established for at least 12 months before cashing bonds at a financial institution.
When redeeming a bond, proper identification is required. If the customer's name appears only in the "Mail to" address printed on the bond, they are not considered a registered owner and are not entitled to payment. The address and Social Security Number on the bond do not need to match the customer's current information. However, the customer should enter their correct address and/or Social Security Number on the back of the bond before proceeding with the redemption. A signature is certified when it is signed in the presence of a bank representative, and the name and address on the form match the customer's documentation.
In addition to name changes, there are other special circumstances in which bonds can be redeemed. For example, bonds can be redeemed by the estate of the last decedent on a bond, with the appropriate death certificates and letters of appointment for the representative. Bonds can also be redeemed by a surviving beneficiary listed on the bond, using normal identification procedures and a copy of the death certificate.
It is important to note that individuals acting under a power of attorney cannot cash a savings bond or note. In such cases, the bond must be forwarded to the Treasury Retail Securities Site for processing. Similarly, bonds that have been altered or defaced in any way should not be cashed by banks and should be forwarded to the Treasury Retail Securities Site.
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Bonds can be redeemed to the estate of the last decedent
If a savings bond names only one person as the owner, then the bond becomes part of the estate when the owner dies. That means it passes to whomever is named to receive the bond in the will (or the residuary beneficiary if no one is specifically named in the will to receive the bond), or if there is no valid will, then to the heirs under state law.
If a savings bond names two people as owners, the survivor automatically inherits it when the first owner dies. Probate won't be required in this case. If both owners have died, the bond belongs to the estate of the one who died last. That person's estate must be "settled" – distributed according to the person's will or the law.
A court-appointed representative of an open-administered estate may distribute specific bonds to specific heirs. Each heir must complete paperwork to redeem and/or reissue their specific bonds. The entire amount of a savings bond must go to one owner as directed by the court-appointed representative.
If the estate doesn't go through probate, use Form 5336, "Disposition of Treasury Securities Belonging to a Decedent's Estate Being Settled Without Administration" to request that the bond be paid out to whoever is entitled to it. Include a certified copy of the death certificate. If the inheritors are claiming the bonds with a small estate affidavit, include a copy; if you're using summary probate procedures, include a copy of the probate court's order.
For paper bonds, use Form 4000 to reissue (re-register) the bond in the heir's name, or Form 1522 to redeem the bonds. For electronic bonds, use Form 5511 to transfer the bond to themselves, or Form 5512 to redeem (cash in) the bonds.
Most banks will redeem savings bonds if you have a relationship with that bank. You should contact your bank directly for more information.
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Paper savings bonds can be cashed if they've reached their term limit
Savings bonds are a government-backed investment that earns interest, reaching full maturity after 30 years. Paper savings bonds can be cashed in, even if they are no longer earning interest, as long as they have reached their term limit.
There are several types of savings bonds, including Series E/EE, Series I, and Series H/HH. Only E/EE and I bonds are still sold, but all types can be redeemed through the Federal Reserve. Series E/EE bonds earn a fixed rate of interest for up to 30 years, while Series I bonds earn interest based on a combination of a fixed rate and an inflation rate. Series H/HH bonds are slightly different, as they pay out interest every six months until maturity or redemption.
It is possible to redeem a savings bond as soon as one year after it is purchased, but it is generally beneficial to wait until full maturity to avoid losing the last three months' worth of interest. Most savings bonds stop earning interest or reach maturity between 20 to 30 years. If you have the serial numbers of your old bonds, you can use the Treasury Hunt tool to see if you have any savings bonds listed and how to claim and cash them.
Most banks will redeem savings bonds if you have a relationship with the bank. However, financial institutions now have the option to not cash savings bonds for non-customers or new customers.
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Frequently asked questions
Most banks will redeem savings bonds if you have an account with them, but they are not required to do so. Financial institutions now have the option to not cash savings bonds for non-customers or new customers.
You should contact your bank directly to find out if they will redeem your savings bonds.
You will need your Social Security Number or Taxpayer Identification Number, as well as proof of identity, such as a driver's license.
You can redeem your savings bonds through the Federal Reserve or the U.S. Treasury Department.
