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Savings-Bonds-Alert: Best day to cash bonds

Thursday, July 29, 2004

Best day to cash bonds

I have some EE savings bonds which were purchased in August 1992, which means they will soon reach their original maturity date. If I decide to cash them in, what would be the best day to do so? I'm guessing August 2nd, since it's the first business day of the month, but would like confirmation. If I choose to keep them (which is more likely), I'd like to better understand the "extended maturity" period. I think the next period will be 10 years. Does that mean, if I don't redeem them next month, that I won't be able to cash them in for another 10 years without paying some sort of penalty? Also, does the 4% "minimum rate" apply to just the upcoming 10 year period, or does it also include the prior 12 years (when I earned 6%)? Tom's response The best day to cash in bonds purchased in August 1992 would be the first business day of August or February. If you keep them, you can cash them in at any time. The only penalty you might pay is the one you already understand - if you don't cash them in on the first business day of August or February, you'd lose the interest from then until the day you cashed them in. This interest-rate penalty applies to all Series E and EE bonds issued before May 1997. For Series E bonds purchased before December 1965, these best date to redeem isn't even the first day of the issue month. For more information, see Redeeming Series E and EE Savings Bonds. The 4% minimum rate is going forward. The 6% rate your bonds have already earned is locked in and can't be reduced now. Click here to visit the premier independent web site for Treasury Saving Bond owners.


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