U.S. Savings Bonds are a smart investment tool because they offer tax advantages that other investment devices don’t. In addition, they are a safe investment because they are fully backed by the U.S. Government, and it’s a patriotic way to invest because the money invested helps pay the country’s bills. Still, there may come a time when you need or want to cash your U.S. Savings Bonds in. But where and how?
Current U.S. Savings bonds can be cashed at any banking institution. Your regular bank is a perfect place. If the bonds are in your name and you have been with a bank for a period of time, you simply cash the bond as you would any check. If you don’t have an account at the bank, are a new customer, or get a new teller, you might want to have identification handy, such as your driver’s license. Again, the process of cashing in your bonds should be no different than what you have gone through to cash your check.
If the bond is not in your name, then you will have an additional hoop to jump through. You have to prove that you are entitled to the proceeds of the bond (just as with a check). If the bond is in your minor child’s name, you can endorse it for them. If the bond was a gift, you will need the payee to vouch for you, either in person (they might as well go ahead and cash it and give you the proceeds) or, perhaps, by executing an affidavit. If the bond was bequeathed to you, take a copy of the will and a certificate of death.
When cashing a current bond, it doesn’t matter what bond series it is. Currently, the U.S. issues Series EE and I bonds. The only restriction to immediate cashing either of these bonds is that if you purchased the bond after February 1, 2003, you have to hold the bond for one year prior to turning it in.
If you hold an older bond such as a Series HH bond, you can take them to your bank. However, the bank will have to forward the HH bond to the Federal Reserve Bank for cashing. If this is the case, you would be wise to have the proceeds directly deposited into your account. Let your banker know this is what you want to do and he/she can provide the proper form.
One issue to be aware of is that some smaller banks might try to discourage you from cashing your bonds. I’ve heard of this happening from a couple of people who recently turned in bonds. Essentially, the banker was concerned that they were cashing their bonds because the holders were concerned about the banking and credit crisis. The banker tried to get them to hold onto their bonds. Holding on to them is fine, if that’s what you want to do. However, don’t let a banker discourage you. If this happens to you, simply take your banking business (all your banking business) elsewhere. A bank that uses scare tactics to keep its customers is not a bank you want holding your money.
U.S. Savings bonds are an excellent investment tool. They are safe and help Uncle Sam at the same time. Best of all, there are no tricky mechanisms to cashing them in when the time is right for you. Handle them like you would any check, with full confidence that every reputable bank will provide you your full proceeds at the time of your choosing.