Who Cashes Savings Bonds and What You Need

United States savings bonds are low-risk, interest-bearing securities issued by the U.S. Department of the Treasury. This article serves as a guide for individuals seeking to understand where and how they can cash their savings bonds.

Entities That Cash Savings Bonds

Most commercial banks and credit unions offer services to cash paper savings bonds, typically for their account holders. It is advisable to contact a local branch beforehand to confirm their specific policies, as some institutions may cash bonds for non-customers, while others may require an established banking relationship.

Electronic savings bonds are managed and cashed through TreasuryDirect, the U.S. Department of the Treasury’s online platform. This system allows bondholders to securely access and manage their electronic bond holdings, including initiating redemption requests.

Requirements for Cashing Savings Bonds

For in-person transactions involving paper bonds, a valid, government-issued photo identification is necessary, such as a driver’s license, state identification card, or passport. The name on the identification must precisely match the name(s) printed on the savings bond to verify ownership.

Possession of the original physical bond certificate is required for paper bond redemption. Electronic bondholders must have access to their TreasuryDirect account, which serves as the digital representation of their bond holdings.

Savings bonds are subject to a mandatory minimum holding period of 12 months from their issue date before they can be cashed. Cashing a bond before five years have passed from its issue date results in a forfeiture of the last three months of interest earned.

Cashing Process and Options

For paper bonds, an individual typically presents the original bond and their identification to a teller at a participating financial institution. The institution will then verify the bond’s authenticity and confirm the identity of the bondholder. Payment is usually disbursed immediately, either as cash or a direct deposit into an account, though some smaller institutions may need to send the bond to the Treasury for verification, which can introduce a delay.

Electronic bonds are redeemed online through TreasuryDirect. Bondholders log into their account, navigate to the “ManageDirect” section, and select the cashing option for their desired bonds. The funds are then directly deposited into the linked bank account, typically within one to two business days following the redemption request. A minimum redemption amount of $25 is usually required for electronic bonds, and partial redemptions are possible, provided at least $25 remains in the bond’s value.

Cashing Bonds in Special Situations

Cashing savings bonds under unique circumstances, such as for a deceased owner or a minor, involves additional steps. When a bond owner is deceased, specific legal documentation is necessary, including a certified death certificate and, potentially, probate documents or Treasury forms like FS Form 5336, to establish the right of the beneficiary or executor to redeem the bond. These cases often require direct submission of documents to the Treasury Department.

For bonds owned by a minor, a parent or legal guardian can typically cash the bond by presenting their identification and proof of guardianship. For paper bonds, specific language must be written on the back of the bond by the parent certifying their relationship and the minor’s inability to sign. If a paper bond is lost, stolen, or destroyed, it cannot be cashed until a replacement is requested from the Treasury, a process that involves submitting FS Form 1048.