What Banks Accept Savings Bonds & How to Redeem Them

U.S. savings bonds are a type of debt security issued by the United States Department of the Treasury to help fund federal government operations. These bonds are considered a low-risk, interest-bearing investment, backed by the full faith and credit of the U.S. government. They are designed to offer a secure and accessible savings option for individual investors. When held, savings bonds accrue interest over time until they are redeemed for their accumulated value.

Redeeming Savings Bonds

Many financial institutions, including most commercial banks and credit unions, offer services for redeeming U.S. savings bonds. While some institutions may redeem bonds for non-customers, many prioritize their own account holders, and some may even require a long-standing customer relationship, such as an account open for a year or more. Contact your preferred bank or credit union beforehand to confirm their specific redemption policies and any requirements.

TreasuryDirect serves as the primary platform for managing and redeeming electronic savings bonds. This online system, operated by the U.S. Department of the Treasury, allows direct access and control over your bond holdings. While paper savings bonds are no longer issued as of January 1, 2012, existing paper bonds can still be redeemed through financial institutions or by mail through TreasuryDirect.

Gathering What You Need

To redeem a savings bond, gather all necessary documentation and understand its status. Valid government-issued photo identification, such as a driver’s license, state ID, or passport, is required to verify your identity. If you are redeeming a paper savings bond, you will need the physical bond itself, ensuring it is in good condition. For electronic bonds, access to your TreasuryDirect account is necessary.

Understanding the bond’s maturity is important, as savings bonds must be held for at least one year from their issue date before they can be redeemed. While bonds can be cashed after one year, redeeming them before five years results in a forfeiture of the last three months of interest. Series EE and Series I bonds, the most common types, accrue interest for up to 30 years, at which point they reach final maturity and cease earning interest. If you intend to have the redemption proceeds directly deposited, ensure you have the routing and account numbers for your bank account.

Completing the Redemption

After gathering all required documents and information, the redemption process can begin. For in-person redemption at a bank or credit union, you will present your savings bond and valid government-issued identification to a representative. The representative will guide you through any necessary forms, such as FS Form 1522, and may require you to sign the bond in their presence. For amounts exceeding $1,000, a certified signature, often requiring a notary public, may be necessary.

For electronic bonds or paper bonds converted to electronic form, redemption is completed through your TreasuryDirect account. You will log in, navigate to the “ManageDirect” section, and select the bonds you wish to redeem. The system will prompt you to confirm the direct deposit details for the funds. Funds from electronic redemptions are transferred to your designated bank account within one to two business days. For paper bonds redeemed by mail, the process can take longer, potentially several weeks or even months, with funds deposited directly into your bank account.