How to Cash In a Savings Bond: Complete Guide
Learn how to redeem your savings bonds online, by mail, or at a bank with step-by-step instructions.
Savings bonds are a popular investment vehicle that offers security and steady returns over time. Whether you received a savings bond as a gift, purchased one years ago, or are looking to consolidate your investments, understanding how to cash in your savings bonds is essential. The redemption process has become increasingly streamlined, especially with the digital transformation of the Treasury Department. This comprehensive guide will walk you through all available methods to convert your savings bonds into cash.
Understanding Savings Bonds and When You Can Cash Them
Before diving into the redemption process, it’s important to understand the basic requirements and timing considerations for cashing in your savings bonds. Savings bonds must be held for a minimum of one year before they become eligible for redemption. This one-year holding period is a fundamental requirement that applies regardless of the redemption method you choose.
If you decide to cash in your savings bond before five years have passed since the purchase date, you will forfeit three months’ worth of accrued interest as a penalty. This penalty structure encourages longer-term holding while still maintaining reasonable access to your funds after the initial year. After five years, you can redeem your bonds without any interest penalties, making this a more attractive time to cash in your investment if you don’t need the funds immediately.
Series EE and Series I savings bonds, the most common types available today, can be held until they reach their final maturity, typically around 30 years. However, the interest-earning period generally ends after 30 years, so holding bonds beyond this point provides no additional financial benefit.
Three Primary Methods to Cash In Your Savings Bonds
The Treasury Department and financial institutions offer three main methods for redeeming your savings bonds. Each method has distinct advantages and is suited to different preferences and situations.
Method 1: Online Redemption Through TreasuryDirect
For those with electronic savings bonds, online redemption through TreasuryDirect represents the fastest and most convenient option. Electronic savings bonds have been the standard for all new purchases since January 2025, though you can still redeem paper bonds through other methods.
To redeem online, follow these steps:
- Visit the TreasuryDirect website and log into your account using your username and password
- Navigate to the “Current Holdings” or “ManageDirect” section of your account dashboard
- Select the bond or bonds you wish to redeem
- Choose whether to redeem the entire bond value or a partial amount
- Confirm your redemption request and review the details
- Submit the request for processing
When redeeming online, you must cash a minimum of $25 or any amount above that in one-cent increments. If you’re redeeming only a portion of a bond’s value, you must leave at least $25 remaining in your TreasuryDirect account unless you’re cashing the bond completely. Additionally, when you redeem only part of a bond’s value, you only receive interest on the portion you redeem, not the portion you leave behind.
The funds from online redemptions typically transfer to your designated checking or savings account within two business days. This quick processing time makes online redemption ideal for those who need access to their funds in a reasonable timeframe.
Method 2: Mail Redemption for Paper Bonds
If you hold paper savings bonds, you can redeem them by mail through the Treasury Department. This method requires more preparation and involves a longer processing timeline but remains a viable option for those with physical bonds.
To redeem paper bonds by mail, you’ll need to complete FS Form 1522, which is the official redemption form provided by TreasuryDirect. Gather the following information for each bond you want to cash:
- Bond serial numbers
- Issue dates of each bond
- Current value of the bonds
- Your Social Security number
- Direct deposit account information
You can redeem up to 30 paper savings bonds using a single FS Form 1522 submission. However, unlike electronic bonds, you cannot redeem a partial value from a paper bond—you must cash the entire bond for its complete value.
For bonds worth $1,000 or less, you can mail a photocopy of your government-issued identification along with the completed form and unsigned bonds to the Treasury Department. If your bonds are worth more than $1,000, the signature requirements are more stringent: each person named on the bond must sign the form in the presence of a notary public or authorized certifying officer before submission.
Send your submission to:
Treasury Retail Securities Services
PO Box 214
Minneapolis, MN 55480-0214
Processing times for mail redemptions vary but typically take longer than online submissions. The Treasury Department will process your request and deposit the funds into your designated account, though the timeline can extend several weeks depending on mail delivery and processing queue.
Method 3: Bank or Credit Union Redemption
Many banks and credit unions offer in-person savings bond redemption for their customers. This method provides the advantage of face-to-face service and immediate verification of documents.
Before attempting to redeem your bonds at a bank, it’s wise to contact your financial institution first. Not all banks handle savings bonds, and those that do may have specific requirements or limitations. Some institutions require you to maintain an active account with them, while others may impose limits on the number of bonds or total value they will redeem at one time. The Secret Service recommends that banks not cash bonds for customers who have not been established at the bank for at least 12 months, a guideline many financial institutions follow.
When visiting your bank or credit union to redeem paper bonds, you’ll need to provide valid government-issued identification. For large redemptions exceeding $1,000, additional verification or notarization requirements may apply. The staff can guide you through their specific procedures and process your redemption on the spot.
Identification and Verification Requirements
Proper identification and verification are crucial components of the bond redemption process, regardless of which method you choose. These security measures protect both you and the government from fraudulent claims.
For online redemptions, your TreasuryDirect account login serves as your primary verification. Make sure your account information is accurate and up-to-date before attempting to redeem bonds.
For mail submissions, identification requirements depend on the bond value. Bonds worth $1,000 or less require a photocopy of a government-issued ID. For bonds exceeding $1,000, notarization is required, meaning each person named on the bond must have their signature certified by a notary public or other authorized certifying officer.
At banks and credit unions, staff will request government-issued identification such as a driver’s license or passport. Some institutions may require additional documentation depending on their internal policies and the bond value being redeemed.
Calculating Your Bond’s Current Value
Before redeeming your savings bonds, it’s helpful to know their current value. The TreasuryDirect website provides a Savings Bond Calculator tool that allows you to determine the exact worth of your bonds based on the series, denomination, and issue date.
Understanding your bond’s value helps you plan your redemption strategy and determine which method is most appropriate. For smaller redemptions, online access through TreasuryDirect is typically most efficient. For larger amounts or multiple bonds, you might consider alternatives based on the requirements and timelines involved.
Tax Implications of Cashing Savings Bonds
When you redeem savings bonds, the interest earned becomes taxable income. For bonds redeemed in any given year, you’ll receive a Form 1099-INT for your tax return, which reports the interest income. This form will be available in your TreasuryDirect account in January of the year following the redemption.
The interest accrued on your savings bonds is subject to federal income tax. However, savings bonds are exempt from state and local income taxes, providing a tax advantage compared to many other investment vehicles. If you have questions about the tax treatment of your specific bonds, consult with a tax professional or accountant.
Special Circumstances and Considerations
Certain situations require additional documentation or special handling when redeeming savings bonds. If you’re redeeming bonds as a beneficiary or if the bonds are held in an estate, you may need to provide legal documentation proving your entitlement to the bonds.
If bonds are registered in the name of a deceased owner, the redemption process may require probate documents, death certificates, or other legal evidence depending on the bond value and beneficiary status.
For bonds held jointly or transferred between parties, ensure that proper ownership documentation is maintained and provided during redemption to avoid processing delays.
Frequently Asked Questions About Cashing Savings Bonds
Q: What is the minimum amount I must cash in my savings bonds?
A: For electronic bonds redeemed online, the minimum redemption amount is $25. You can redeem any amount above that in one-cent increments. For paper bonds, you must redeem the entire bond value.
Q: How long does it take to receive my money after redeeming?
A: Online redemptions through TreasuryDirect typically transfer funds within two business days. Mail redemptions through the Treasury Department may take longer, depending on mail delivery and processing times. Bank redemptions may vary by institution.
Q: Can I redeem only part of an electronic savings bond?
A: Yes, electronic Series EE and Series I bonds can be partially redeemed through TreasuryDirect, provided you redeem at least $25 and leave at least $25 in your account. Paper bonds must be redeemed in full.
Q: What happens if I redeem my bond before five years?
A: If you cash in your savings bond within five years of purchase, you forfeit three months’ worth of accrued interest as a penalty. After five years, you can redeem without any interest penalties.
Q: Do I need a TreasuryDirect account to redeem paper bonds?
A: No. You can redeem paper bonds by mail directly to the Treasury Department using FS Form 1522, or at a bank or credit union that handles savings bonds. However, you do need a TreasuryDirect account for electronic bond redemptions.
Q: What identification do I need to cash in my bonds?
A: For online redemptions, your TreasuryDirect login is sufficient. For mail submissions, include a photocopy of government-issued ID. For bonds worth over $1,000, notarization is required. At banks, present valid government-issued identification.
Q: Can I purchase paper savings bonds today?
A: No. As of January 2025, all new savings bonds are issued electronically through TreasuryDirect. However, you can still redeem paper bonds purchased in previous years.
References
- Cash EE or I Savings Bonds — U.S. Department of the Treasury TreasuryDirect. 2025. https://treasurydirect.fiscal.treasury.gov/savings-bonds/cashing-a-bond/
- How to Cash In Savings Bonds — Experian. 2025. https://www.experian.com/blogs/ask-experian/how-to-cash-in-savings-bonds/
- How to Cash In Savings Bonds: It’s Easier Than You Think — Citizens Bank. 2024. https://www.citizensbank.com/learning/how-to-cash-savings-bonds.aspx
- The Guide to Cashing Savings Bonds — U.S. Department of the Treasury TreasuryDirect. 2024. https://treasurydirect.gov/forms/sav0022.pdf
- Savings Bond Redemptions Frequently Asked Questions — Federal Reserve Financial Services. 2024. https://www.frbservices.org/resources/treasury/faq/savings-bond-redemptions.html
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