Steps for How to Sell a Savings Bond When it Matures
written by: Tim Plaehn•edited by: John Garger•updated: 2/8/2011
If you have some U.S. savings bonds and you would like to convert them to cash, this article shows you how the bonds grow in value and how to sell a Series EE or I savings bond.
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Savings Bond Values
Savings bonds are savings certificates issued by the U.S. Department of the Treasury. Before jumping in on how to sell savings bond, it is important to understand how savings bonds accumulate value and what is the current value of your savings bonds. Savings bonds can be purchased in electronic form, but the most familiar are the paper Series EE bonds purchased for one-half the denomination of the bond. For example, a $100 savings bond initially costs $50.
Since May of 2005, Series EE bonds have been issued with a fixed rate of interest that will be paid on the bond for up to 30 years. Savings bonds accrue interest monthly and compound semi-annually. Series EE savings bonds are guaranteed to reach the denomination printed on the bond, a doubling of the original investment, no later than 20 years after a bond is issued. If a bond has not earned enough interest to make the double, the Treasury will make a one-time interest credit to bring the bond up to value.
Series I savings bonds are another form that earn interest based on the rate of inflation. The procedures for Series I bonds are the same as for Series EE bonds. Find the value for any savings bond using the online Savings Bond Calculator. Click the "Get Started" link.
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Cashing in Savings Bonds
First thing: Savings bonds cannot be sold. Bonds are issued in an owner's name and only the named owner or a listed beneficiary can redeem savings bonds. If you bought a bond off eBay with someone else's name on it, it is worthless to you. Savings bonds can be redeemed at maturity or any time after 12 months of the issue date. Bonds cashed in the first five years will be charged a penalty of the most recent three months interest earnings.
Paper savings bonds can be cashed or redeemed at most banks or credit unions. You must sign the bond and show identification to prove you are the listed bond owner and the bank will cash the bond on the spot. The Treasury recommends cashing bonds at a bank where you have an account. The maximum amount of bonds that can be cashed by a bank is $1,000.
To redeem more than $1,000 worth of savings bonds, you still need to go to the bank. The bank officer will verify your identification, authenticate your signature on the bond, and record your social security number on the savings bond. The bonds are then mailed to one of the Treasury's Retail Security Sites and the Treasury will mail you a U.S. government check for the value of the bonds.