Posted on Friday, 14th August 2020 by

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Many federal employees, including myself, purchased paper savings bonds though payroll deduction until paper bonds were discontinued eight years ago. Savings bonds mature after 30 years.  If you own bonds that are thirty or more years old, they no longer earn interest and should be cashed in. Many banks and credit unions no longer redeem them. 

Request a Federal Retirement Report™ to review projected annuity payments, income verses expenses, FEGLI, and TSP projections.

Taxes are due on the interest earned when savings bonds are cashed in, and bonds held to maturity appreciated in value considerably. For example, a $500 series EE bond purchased on January 1, 1993 for $250 is worth $617 today and is earning 4%. The series EE bonds were sold at half face value, so it was purchased for $250, not $500. This bond is three years from maturity and a 4% yield is almost impossible to get anywhere today.

Fortunately, PNC, my local bank, still redeems bonds. If your local bank or credit union refuses to cash in your bonds, the process is tedious to say the least. you must download and complete the FS Form 1522 from Treasury Direct. You can also request a form by calling 844-284-2676 or email a request to  All of the bonds you are cashing in must be listed individually on the form and if you need more space, attach either a list or FS Form 3500. The original form only has space for 10 bonds.

Here is the tricky part, the form must be signed by the bond holder in the presence of a certifying officer. Typically, you take the form to your local bank and have them place a medallion stamp on the document. Yes, it is a convoluted process, it was so much easier when everyone could simply redeem them at your local bank.

Follow the instructions on the form and mail the completed form with your bonds to the Treasury. Make sure you mail them to the correct address. Here are the two addresses listed on the form:

  • Series HH or Series H savings bonds:

Treasury Retail Securities Services, PO Box 2186, Minneapolis, MN 55480-2186. (Phone: 844-284-2676–toll free.)

  • All other securities:

Treasury Retail Securities Services, PO Box 214, Minneapolis, MN 55480-0214. (Phone: 844-284-2676–toll free.)

After processing, the Treasury will deposit the proceeds into your bank account and send you a notice of interest earned for tax purposes. The last time I cashed in mature bonds I received a tabulation of the interest earned from the bank teller.

What I recommend is finding a local bank or credit union in your area that still redeems savings bonds even if you have to open an account with them, it is so much easier.

That being said, you can buy savings bonds and Treasury notes, bills, and bonds electronically on As a TreasuryDirect account holder, you can purchase, manage, and redeem bonds directly from your web browser. Explore the site before registering for a new account.

I still purchase inflation indexed “I bonds” and TIPS online through Treasury Direct to protect a portion of my retirement savings. Another option is to purchase inflation-protected securities through a mutual fund such as Vanguard Inflation-Protected Securities (VIPSX). This fund has a Morningstar Analyst Rating of Gold with 4 stars. 

It is easy to sign up for a Treasury Direct account and to redeem or purchase new bonds. The funds go into or out of your designated bank account. Just remember that you can’t redeem savings bonds until you owned them for at least a year.

Those in their early to mid-career may wish to consider EE bonds. Currently, they only pay .10% interest. However, if you hold them twenty-years they are guaranteed to double in value which is approximately a 3% annual return.

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Request a Federal Retirement Report™ to review projected annuity payments, income verses expenses, FEGLI, and TSP projections.


Disclaimer: Opinions expressed herein by the author are not an investment or benefit recommendation and are not meant to be relied upon in investment or benefit decisions. The author is not acting in an investment, tax, legal, benefit, or any other advisory capacity. This is not an investment or benefit research report. The author’s opinions expressed herein address only select aspects of various federal benefits and potential investment in securities of the TSP and companies mentioned and cannot be a substitute for comprehensive investment analysis. Any analysis presented herein is illustrative in nature, limited in scope, based on an incomplete set of information, and has limitations to its accuracy. The information upon which this material is based was obtained from sources believed to be reliable, but has not been independently verified. Therefore, the author cannot guarantee its accuracy. Any opinions or estimates constitute the author’s best judgment as of the date of publication, and are subject to change without notice. The author explicitly disclaims any liability that may arise from the use of this material.

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