Can You Cash in Non-Mature Savings Bonds?

by Jeffrey Joyner

Although the federal government sold bonds periodically throughout its history, it wasn't until 1935 that non-marketable savings bonds appeared. That year marked the debut of the "baby bonds," which were sold until 1941. The basic premise behind savings bonds was to offer a Treasury security that would offer safe, predictable appreciation over a fixed period of time. Once a bond reaches maturity, it no longer earns interest. However, you may sell your bonds before they mature. The length of time you must own the bonds and the interest penalty for early redemption depend on which series of bonds you own and when you purchased them.

Series EE Bonds

If it has been at least 30 years since you purchased your Series EE bonds, run, don't walk, to cash them in. They are no longer earning interest and will never earn another penny of interest. Redeem the bonds and put your investment money back to work. As of Feb. 1, 2003, you must wait 12 months from the issue date to redeem Series EE bonds. If you cash bonds within the first five years, you will lose the interest for the last three months.

Series HH Bonds

The Treasury Department sold Series HH bonds from 1980 to 1982 and issued them in exchange for Series E and Series EE bonds from 1982 to 2004. The bonds, available in $500, $1,000, $5,000 and $10,000 denominations, were issued at face value. Series HH bonds have a 20-year maturity and a six-month hold time, so you can redeem them any time you choose. Keep in mind that interest is paid on these bonds every six months, counting from the issue date, so if you redeem them in between interest payments, you stand to lose several months of interest. Don't try to cash in these bonds at your local credit union, though. You have to redeem them at a Federal Reserve Bank or through the Bureau of the Public Debt.

Series I Bonds

Series I bonds with an issue date of Feb. 1, 2003 or later require a 12-month hold time prior to redemption. Those with an issue date on or before Dec. 1, 2002, required only a six-month hold time. However, if you redeem these bonds before a full five years have elapsed between issuance and redemption, you will lose three months of interest.

Mature Bond Series

If you are still holding onto any Series E bonds, cash them in and reinvest the money. No Series E bond has earned any interest since 2010. None of the Series H bonds are still accruing interest, nor are the "Savings Notes." Series A, B, C, D, F, G, J and K bonds are all mature as well.

About the Author

Jeffrey Joyner has had numerous articles published on the Internet covering a wide range of topics. He studied electrical engineering after a tour of duty in the military, then became a freelance computer programmer for several years before settling on a career as a writer.

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