Cashing in the savings bonds

paying for higher education

Savings BondI wanted to start cashing in the savings bonds I bought thirty years ago. Late in 1992, I decided to buy $100 US savings bonds through my job’s payroll plan; they cost $50 each.

The first two EE bonds matured recently. The elder, from 1992, was now worth a whopping $207.36. However, the second, from 1993, was valued at $164.12. It’s like me to get on a  good thing after it peaked.

I checked my bank’s website, which suggested they would cash them, but I went there and was told, “We haven’t done that in years.” Then I checked my credit union’s online bot, which told me I had to prove they were mine, even though my name was on them. I would need an unsigned copy of FS Form 1522.

After posting my confusion on Facebook, I got advice to try my credit union, my bank but to give them notice, and another bank. Ultimately, I went to my credit union, which was easier than anticipated.

I noticed that my bonds from 1993 through 1995 are getting 4% interest, which will cash out at about $160 each at maturity. But the 1996 and 1997 ones now receive 2.82% interest and will only be worth about $125 eventually.


One of my relatives has several matured savings bonds left by a spouse, which they have not yet cashed because they are wary of the tax implications.

From Smart Asset: “You won’t pay state or local income tax on interest earnings, but you may pay state or inheritance taxes if those apply where you live.

“You have one option for avoiding taxes on savings bonds: the education exclusion. You can skip paying taxes on interest earned with Series EE and Series I savings bonds if you’re using the money to pay for qualified higher education costs. That includes expenses you pay for yourself, your spouse, or a qualified dependent. Only certain qualified higher education costs are covered, including:

  • Tuition
  • Fees
  • Some books
  • Equipment, such as a computer

“You can still use savings bonds to pay for other education expenses, such as room and board or activity fees, but you wouldn’t be able to avoid paying taxes on interest.”


I’ve known a couple of people dealing with estates involving savings bonds. They involve more legalese than I need to share here.

They may need to provide death certificates they do not possess. I know that, e.g., the city of Albany provides them “upon proof of entitlement under New York State (NYS) Public Health Law.” In Mecklenburg County (Charlotte), NC, you can get one when “seeking information for legal determination of personal property rights.”

Oh, I know I have lost one bond from 1993. I can tell because there is a gap in the dates issued. Since I have a TreasuryDirect account, I can replace it by filling out FS Form 1048. It shouldn’t be signed before being witnessed by a notary.

Author: Roger

I'm a librarian. I hear music, even when it's not being played. I used to work at a comic book store, and it still informs my life. I won once on JEOPARDY! - ditto.

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