{"id":1091,"date":"2020-07-03T00:00:00","date_gmt":"2020-07-03T00:00:00","guid":{"rendered":"https:\/\/qa.simplifimoney.com\/blog\/savings-bond-calculator\/"},"modified":"2024-11-18T10:21:45","modified_gmt":"2024-11-18T18:21:45","slug":"savings-bond-calculator","status":"publish","type":"post","link":"https:\/\/www.quicken.com\/blog\/savings-bond-calculator\/","title":{"rendered":"Should You Redeem Your Savings Bond? Use This Calculator"},"content":{"rendered":"\n<p>Purchasing U.S. savings bonds can be one of the safest ways to earn money on your savings, as a savings bond\u2019s value is backed by the full faith and credit of the U.S. government. They can also offer tax advantages over similar products, such as a savings account or <a href=\"\/blog\/grow-savings-cd-laddering\">certificate of deposit<\/a> (CD).&nbsp;<\/p>\n\n\n\n<p>Although you might not earn a lot of interest, the guaranteed return can make them an important part of some people\u2019s portfolios. Learn more about how savings bonds work, how to calculate their value, and how to redeem.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">How Savings Bonds Work&nbsp;<\/h2>\n\n\n\n<p>When you buy U.S. <a href=\"\/blog\/5-places-stash-your-cash\">savings bonds<\/a>, you\u2019re lending the government money, and it will pay you back with interest. How much interest you\u2019ll earn depends on the type of bond you have and how long you\u2019ve held onto it.<\/p>\n\n\n\n<p>Today, you can buy two types of U.S. savings bonds\u2014Series EE and Series I.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/www.treasurydirect.gov\/indiv\/products\/prod_eebonds_glance.htm\">Series EE savings bonds<\/a> have a fixed interest rate (Series EE bonds issued before May 2005 may have a variable rate). Starting with a $25 bond, you can buy up to $10,000 per year online at <a href=\"https:\/\/www.treasurydirect.gov\/\">TreasuryDirect.gov<\/a>. Interest gets added to the bond monthly, and the government guarantees that the bond will <a href=\"https:\/\/www.treasurydirect.gov\/indiv\/research\/indepth\/ebonds\/res_e_bonds_eeratesandterms_eebondsissued052005andafer.htm\">double in value after 20 years<\/a>. After 30 years, EE savings bonds mature and stop accruing interest.&nbsp;<\/li>\n\n\n\n<li><a href=\"https:\/\/www.treasurydirect.gov\/indiv\/products\/prod_ibonds_glance.htm\">Series I savings bonds<\/a> have a fixed interest rate plus a variable rate based on inflation, which can change every six months. Although deflation could lead to a negative variable rate, the lowest your bond\u2019s rate will go is 0%. You can buy Series I savings bonds online starting at $25 or purchase paper bonds starting at $50 with your federal tax return, up to $10,000 and $5,000 per year, respectively. The government doesn\u2019t guarantee earnings, but interest can accrue for up to 30 years.<\/li>\n<\/ul>\n\n\n\n<p>While these are the only types of savings bonds you can buy today, there are other types that you may have bought or been given in the past. You can use a savings bond calculator to find out how much they\u2019re worth and determine if you want to redeem them now or wait.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Figuring Out How Much Your Savings Bond Is Worth<\/h2>\n\n\n\n<p>Savings bonds don\u2019t <a href=\"\/blog\/portfolio-management\">provide a steady flow of income<\/a> like a dividend-paying stock. Instead, accrued interest is added to the savings bond\u2019s value, which you\u2019ll receive when you redeem the bond.&nbsp;<\/p>\n\n\n\n<p>With both Series EE and Series I bonds, the interest accrues monthly and compounds twice a year. You can use a calculator \u2014 like this <a href=\"https:\/\/www.treasurydirect.gov\/BC\/SBCPrice\">savings bond calculator<\/a> provided by TreasuryDirect \u2014 to determine the value of your savings bonds. You\u2019ll need some information to get started:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Series type<\/li>\n\n\n\n<li>Denomination<\/li>\n\n\n\n<li>Bond serial number<\/li>\n\n\n\n<li>Issue date<\/li>\n<\/ul>\n\n\n\n<p>You must hold onto Series EE and I bonds for at least 12 months before you can cash out. Additionally, if you cash out one of the bonds before five years, you\u2019ll lose three months\u2019 worth of interest as a penalty.&nbsp;<\/p>\n\n\n\n<p>Additionally, if you have Series EE bonds, don\u2019t forget about the guaranteed doubling of value after 20 years. Although the interest rate may be low \u2014 it\u2019s only 0.10% for bonds issued from May to October 2020 \u2014 you\u2019ll still earn an effective rate of 3.5% if you hold the bonds for 20 years.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">How to Cash in a Savings Bond<\/h2>\n\n\n\n<p>You can cash in electronic bonds online at TreasuryDirect.gov. Or, if you have paper bonds, you can cash in at a local financial institution, such as a bank or credit union.&nbsp;<\/p>\n\n\n\n<p>Savings bonds don\u2019t expire, but Series EE and I bonds mature after 30 years, which means bonds issued before 1990 won\u2019t accrue any more interest and there\u2019s little reason to hold onto them. Sometimes, this may happen without you realizing it, such as if someone gave you a bond when you were a child.&nbsp;<\/p>\n\n\n\n<p>As of the end of 2019, more than $26 billion dollars worth of unredeemed savings bonds had matured and stopped earning interest. You can use <a href=\"https:\/\/treasuryhunt.gov\/\">Treasury Hunt<\/a> to search for bonds based on your tax identification number and state of residence.&nbsp;<\/p>\n\n\n\n<p>When you cash in a bond, you\u2019ll be issued a 1099-INT with a record of earned interest. Although you don\u2019t have to pay local or state taxes on the earnings, you may need to pay federal income taxes.&nbsp;<\/p>\n\n\n\n<p>You may also want to cash in a bond even if it hasn\u2019t matured yet if you have a good use for the money. For example, eligible bondholders can avoid paying federal income taxes if they cash in and use the funds for <a href=\"https:\/\/www.treasurydirect.gov\/indiv\/planning\/plan_education.htm\">qualified higher education expenses<\/a>.<\/p>\n\n\n\n<p>Or, you may want to cash in bonds if you need the money for living expenses during retirement or if you have a better investment opportunity elsewhere.&nbsp;<\/p>\n\n\n\n<p>Bottom line: If you don\u2019t need the money now and the interest is still being added, you might want to stow savings bonds in your safe deposit box until they fully mature. But if those bonds you got from as birthday gifts from your well-meaning extended family have matured, cash in and move those earnings to a higher interest investment.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Purchasing U.S. savings bonds can be one of the safest ways to earn money on your savings, as a savings bond\u2019s value is backed by the full faith and credit of the U.S. government. They can also offer tax advantages over similar products, such as a savings account or  (CD).\u00a0<\/p>\n","protected":false},"author":59,"featured_media":1092,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_seopress_robots_primary_cat":"none","_seopress_titles_title":"Should You Redeem Your Savings Bond? Use This Calculator | Quicken","_seopress_titles_desc":"A savings bond\u2019s value can increase over several decades. Find out how much yours are worth and whether you should cash them in.","_seopress_robots_index":"","inline_featured_image":false,"footnotes":""},"categories":[108],"tags":[],"class_list":["post-1091","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-budgeting-savings"],"acf":[],"jetpack_featured_media_url":"https:\/\/www.quicken.com\/blog\/wp-content\/uploads\/2022\/08\/QuickenSavingsBond.jpg","_links":{"self":[{"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/posts\/1091","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/comments?post=1091"}],"version-history":[{"count":5,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/posts\/1091\/revisions"}],"predecessor-version":[{"id":5558,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/posts\/1091\/revisions\/5558"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/media\/1092"}],"wp:attachment":[{"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/media?parent=1091"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/categories?post=1091"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/tags?post=1091"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}