How and When to Cash in Savings Bonds

Make your money work for you by knowing when to cash savings bonds and what to do with your earnings

Savings bonds have been a popular way for Americans to save since 1935 and are a great way to set aside money for family members. Many people received them as children but are unsure how or when to cash their savings bonds in order to get the maximum rate of return. If this describes you, use our guide to learn how, where and when to cash savings bonds - and what to do with the funds. Should you want to re-invest and grow your money further, Citizens Bank can help with options such as certificates of deposit (CDs) and money market accounts (MMAs) that have more competitive interest rates than standard savings accounts. Learn more about how to cash in savings bonds below to determine if now is the right time to redeem and reinvest the ones you have set aside.

What are savings bonds?

Savings bonds, specifically EE/E series bonds, were created as a long-term investment allowing individuals to save in a reliable, low-risk fashion. They are government-backed, available in denominations ranging from $25 to $10,000 to the penny, and bonds issued after April 2005 have a fixed interest rate (older bonds [1997-2005] have a variable interest rate). Anyone who is over 18 and legally competent with a valid Social Security Number, U.S. bank account and U.S. address of record can purchase savings bonds. They are available to be cashed in after a single year, though there is a penalty for cashing in within the first five years. Otherwise, you can keep savings bonds until they fully mature or stop earning interest, which is generally 30 years.

You may find you have an I or HH/H series savings bond, which have a slightly different structure than EE/E bonds. Only EE and I bonds are still issued, but that doesn't mean you can't still cash in other savings bonds. For instance, if you have an H bond, it's no longer earning interest and is a primary candidate for redemption. HH and I bonds may still be earning interest based on the issue date. We'll discuss how you can find out if your bond has stopped earning interest and how much interest it has earned in the next section.

How can you tell when to cash in your savings bonds?

Most savings bonds stop earning interest (or reach maturity) in about 30 years. It is possible to redeem a savings bond once it reaches one year, but it's usually wise to wait at least five years or you will lose the last three months of interest when you cash it in. In fact, depending on the interest rate on your bond and your own financial needs, it's generally beneficial to wait until they fully mature to redeem them.

Check online to determine when your individual savings bonds stop earning interest and are strong candidates for redemption. You can do this by entering the bond number at, where you will be able to see the current value of the bond and the interest rate it is currently accruing. In some cases, bonds can be called before their maturation date, which means they are no longer earning interest (like H bonds). Or, you may have bonds spanning several years, some of which have reached maturity while others still have a few more years to go. If you want to cash in the maximum value of your savings bonds, it's important to know the status of your bonds and check for updates regularly. If you decide now is the time to cash in all or some of your savings bonds, you may be wondering how to do so. Citizens Bank is here to help.

How to cash in savings bonds at Citizens Bank

If you still have paper savings bonds (newly-issued bonds are electronic, and paper bonds can be converted to electronic bonds), take them to a local Citizens Bank along with a photo ID for verification purposes. We will exchange the savings bonds for their cash value; you can then choose to put this money into any of our savings, CD or money market account options or use it for your current expenses. If you have an electronic bond, you can redeem the bond online and have it transferred to your checking or savings account within two business days.

If you don't currently have an account with us, be advised that you can only cash up to $1,000 in savings bonds at one time. If you inherited your savings bonds from a relative after his or her passing, you must show that you have a right to cash the bonds by presenting your photo ID and a copy of the death certificate. Check with the Treasury Department for any updates to the rules about how to cash savings bonds. Or, contact one of our customer service representatives to confirm what you need to bring to redeem your savings bonds.

Tax considerations when cashing in savings bonds

If you are cashing in your savings bond, make sure that you keep a record for tax purposes. This is especially important if the bond has already stopped earning interest as, according to IRS rules, once a bond stops earning interest, the interest earned over the entire life of the bond must be reported on your tax return.

Continue to grow your savings after you redeem bonds with CDs or MMAs

There are many reasons to cash in savings bonds, including making a major purchase or paying down debt like student loans, mortgages, car payments and more. However, if your savings bond has ceased to accrue interest and you wish to continue to grow your savings, a CD or money market may be a great option to deposit the funds.

When you place your money in a CD, the bank holds the money for a fixed period of time and pays you interest at regular intervals. Withdrawing your money early can result in penalty fees, so it's important to make sure that you are comfortable with setting your money aside until the CD matures. When it does, you will receive your original deposit, plus the interest that accrued while the bank held the CD. You can then re-invest in a new CD or other savings option, or use the funds at that time. Money market accounts also have a competitive interest rate and limited withdrawal structure, but they do not have the term limit of a CD, so if you want to earn more with more flexible access, MMAs may be a better option. Speak to a Citizens Bank customer service representative to find out more.

Open a CD account with Citizens Bank

Now that you know how and when to cash in savings bonds, take a look at the bonds you hold and determine which, if any, make sense to redeem now. Then, open a CD account at Citizens Bank and deposit the funds from your converted savings bond.