One of the safest investments available is the Series EE savings bond, issued by the U.S. government.
“This is the most common type of bond and they are purchased at a discount and accrue interest monthly,” says Paul Sundin, CPA and financial advisor with Emparion. “The bonds mature after 20 years, at which point the U.S. Treasury will guarantee that investors have doubled their money.”
Though savings bonds have a low rate of return, there are few investments that guarantee to double your money — but it does take 20 years. In general, you can usually expect to earn more in interest with a Series EE savings bond than with a high-yield savings account, yet the money in the savings account is more accessible.
If you have a Series EE savings bond, it pays to know the current value before deciding to cash it in, since in some cases waiting longer can earn you more interest.
Check the current value of your savings bond
Paper savings bonds
The U.S. Treasury stopped issuing most paper savings bonds in 2012, but they never expire and there’s no deadline to redeem them. They do stop earning interest upon maturity. The value of a paper savings bond can be checked by using the savings bond calculator on the TreasuryDirect website and entering this information found on bond:
- Issue date
- Bond series
- Denomination
Once you enter this information, the calculator can let you know what your paper bond is worth if you cash it in today. You can also use the calculator to determine the worth of the bond if you it on some other date. The TreasuryDirect website also allows you to enter information from multiple bonds to create a list and determine the total value, as well as save the list for reference.
Electronic savings bonds
Most savings bonds can only be purchased in electronic format nowadays. If you have electronic bonds, you can log into your TreasuryDirect account — which was used to purchase the bonds in the first place — and see the value in your account information under the current holdings tab.
How do I cash in my savings bonds?
If you decide to cash in your Series EE savings bond, the process is fairly straightforward.
- Electronic savings bonds: If you purchased bonds through TreasuryDirect, you can cash them in on that website. Once you log into your account, you can find information on redeeming your bonds. The money will be directly deposited in a checking or savings account within two business days.
- Paper savings bonds: If your bank cashes paper savings bonds, you can bring yours to a branch to redeem them. You can also cash in paper bonds by sending them to Treasury Retail Securities Services along with FS Form 1522.
Cashing in bonds early
Series EE savings bonds can be redeemed a year from purchase, but you won’t see the same level of returns if you cash in your bond before it matures in 20 years. Bond holders only receive the guaranteed double of the face value if you hold the bond until maturity.
“The Treasury only waives the one-year rule if you experience a disaster and need to tap your cash sooner,” financial adviser Sundin says.
Additionally, if bonds are redeemed before the fifth year, the last three months of interest are forfeited, which can significantly reduce the total value of your savings bond. For that reason, Sundin cautions against purchasing savings bonds unless there’s a specific purpose for them in your portfolio.
Another feature of the Series EE savings bond is that you can also keep the bond beyond its maturity date. Bond holders continue to earn interest for up to 30 years, making the bond even more valuable the longer it is kept.
FAQs
Check the current value of your savings bond
The value of a paper savings bond can be checked by using the savings bond calculator on the TreasuryDirect website and entering this information found on bond: Issue date. Bond series.
How much is a $200 savings bond worth after 20 years? ›
As a rule of thumb, a $200 savings bond (that you would have paid $100, so half its face value) should be worth at the very least $200 after 20 years. That's because the Treasury guarantees a bond will reach its face value after a maximum of 20 years.
How much is a $50 savings bond worth now? ›
| Total Price | Total Value | YTD Interest |
|---|
| $50.00 | $69.94 | $3.08 |
To calculate the value of a bond, add the present value of the interest payments plus the present value of the principal you receive at maturity.
How much is a Series EE bond worth after 20 years? ›
We guarantee that the value of your new EE bond at 20 years will be double what you paid for it. (If you have an EE bond from before May 2005, it may be earning interest at a variable rate. See more at EE bonds.) We guarantee that the interest rate of an I bond will never fall below zero.
How much is a $50 savings bond from 1980? ›
The original price of EE bonds that we sold from 1980 through April 1995 was one-half its face value. (For example, a $50 bond cost $25.)
Do savings bonds expire after 30 years? ›
Use the Treasury Hunt® tool to discover if you own savings bonds that have reached their 30-year maturity date. That means they're no longer earning interest and are ready to be redeemed!
Do savings bonds double every 10 years? ›
Series EE savings bonds are a low-risk way to save money. They earn interest regularly for 30 years (or until you cash them if you do that before 30 years). For EE bonds you buy now, we guarantee that the bond will double in value in 20 years, even if we have to add money at 20 years to make that happen.
Should you cash in savings bonds after 30 years? ›
If you want full value, you should hold the Series EE bonds at least until maturity, and if you want extra, you can hold them until 30 years. But once 30 years have passed, it's a good idea to cash them in because you won't get any extra benefit.
Are savings bonds worth it anymore? ›
Savings bonds are a good investment when you want to reduce your risk. U.S. Savings Bonds are backed by the full faith and credit of the United States, which has never defaulted on its debt. The Federal government guarantees that you'll receive your principal and interest payments.
In general, though, a savings bond is sold as a zero-coupon bond at a discount, and will reach its full value at its maturity. Therefore, savings bonds mature to their full face value.
What is the penalty for not cashing matured savings bonds? ›
After the one-year mark, you can go ahead and cash in your bond, but you will get hit with a penalty of three months' interest earned on the bond. There is no penalty if you simply hold onto the bond after five years.
What is the value of a bond that matures in 15 years and has a $1000 par value? ›
Answer and Explanation:
The calculated value of the bond is $856.18. Let say, C = annual coupon = $90 (i.e. 9% coupon rate * $1,000 face value) N = years till maturity = 15.
How much is a $50 Series EE bond worth? ›
How much is a $50 EE savings bond worth after 30 years? A series EE bond that has a face value of $50 can be bought for $25. A series EE bond will reach full face value after 20 years and will stop earning interest after 30 years.
How do you calculate how much a bond will sell for? ›
Expressed another way, the current selling price, present value, or market value of a bond = the total of the semiannual interest payments PLUS the amount that will be received when the bond matures both discounted by the current market interest rate.
Is there a penalty for not cashing a EE bond after 30 years? ›
While the Treasury will not penalize you for holding a U.S. Savings Bond past its date of maturity, the Internal Revenue Service will. Interest accumulated over the life of a U.S. Savings Bond must be reported on your 1040 form for the tax year in which you redeem the bond or it reaches final maturity.
When should I cash in savings bonds? ›
Most savings bonds stop earning interest (or reach maturity) between 20 to 30 years. It's possible to redeem a savings bond as soon as one year after it's purchased, but it's usually wise to wait at least five years so you don't lose the last three months of interest when you cash it in.
Do EE bonds mature in 20 or 30 years? ›
All Series EE Bonds reach final maturity 30 years from issue.
How much is a $100 savings bond worth from 1965? ›
But don't be fooled into thinking that the oldest ones are the most precious. A $100 bond issued in January 1943, which stopped earning interest in 1983, is worth just $399.80. But a $100 bond issued in January 1965, which earned a more generous rate until 2005, is worth a cool $936.44.
How long do EE bonds earn interest after maturity? ›
EE and I bonds earn interest for 30 years from the issue date. HH bonds earn interest for 20 years from the issue date.
The bond will earn a few more dollars in interest at the next payment in January 2016. A $500 savings bond with a picture of Alexander Hamilton, a Founding Father and the nation's first treasury secretary, that was issued in April 1986 was worth $1,130.60 as of December. The next interest payment is in April 2016.
Can I cash my deceased parents savings bonds? ›
Get a certified copy of the death certificate for everyone who has died who is named on any of the bonds. Have each person who is entitled to a distributed bond also fill out and sign the appropriate forms: If they want cash for their bond: FS Form 1522.
Does it matter whose Social Security Number is on a savings bond? ›
Sole owner
The individual owns the U.S. Savings Bond if only his or her name appears on it. The Social Security Number shown on a bond is not proof of ownership. EXAMPLE: A U.S. Savings Bond title reads, “John Smith.” Only John Smith can cash that bond.
What do you do with savings bonds when someone dies? ›
If only one person is named on the bond and that person has died, the bond belongs to that person's estate. If two people are named on the bond and both have died, the bond belongs to the estate of the one who died last.
What is the difference between Series I and EE bonds? ›
EE Bond and I Bond Differences
The interest rate on EE bonds is fixed for at least the first 20 years, while I bonds offer rates that are adjusted twice a year to protect from inflation. EE bonds offer a guaranteed return that doubles your investment if held for 20 years. There is no guaranteed return with I bonds.
Where do you cash in savings bonds? ›
Banks and credit unions can redeem savings bonds over the counter.
How do I avoid taxes when cashing in savings bonds? ›
You can skip paying taxes on interest earned with Series EE and Series I savings bonds if you're using the money to pay for qualified higher education costs. That includes expenses you pay for yourself, your spouse or a qualified dependent. Only certain qualified higher education costs are covered, including: Tuition.
What is the easiest way to cash savings bonds? ›
You may be able to cash these bonds in at your bank if it provides that service. You can also cash them in by mail through TreasuryDirect.gov. Complete FS Form 1522 and mail your bonds with the form to the address provided. Your funds will be transferred to your checking or savings account via direct deposit.
What to do with EE bonds that have matured? ›
Redeeming bonds is easy - just take them to a local bank or send them to the Bureau of the Fiscal Service. Directions are available on our web site at TreasuryDirect.gov. If you are unsure whether you own a matured savings bond, a secure search engine is available at TreasuryHunt.gov.
Does a savings bond expire? ›
Use the Treasury Hunt® tool to discover if you own savings bonds that have reached their 30-year maturity date. That means they're no longer earning interest and are ready to be redeemed!
