Yes, U.S. savings bonds stop earning interest after a set number of years
Every U.S. savings bond has a final maturity date. On that date, the bond stops earning interest permanently, even if you keep holding it. For Series EE bonds, final maturity is 30 years from the issue date. For Series I bonds, it is also 30 years. Once that date passes, your bond will not grow in value anymore, no matter how long you own it.
This is different from the original maturity date, which comes much earlier. Original maturity for EE bonds is 20 years; for I bonds, it is also 20 years. At original maturity, the bond stops earning its regular interest rate. After that point, some bonds enter a period where they earn a lower rate until final maturity arrives. But once final maturity hits, all interest stops.
The reason bonds have an end date is that the U.S. Treasury needs to close out its records and stop tracking the bond. Bonds are not like savings accounts that can earn interest indefinitely. They are debt instruments with a defined lifespan, and that lifespan ends at final maturity.
Key Takeaways
- Series EE and Series I bonds both stop earning interest permanently at 30 years from the issue date, which is their final maturity date.
- Original maturity (20 years for both EE and I bonds) is when the regular interest rate stops, but the bond may still earn a lower rate until final maturity.
- After final maturity, the bond's value is locked in and will not increase, even if you continue to hold it.
- You can cash in a bond at any time after five years, but holding it past final maturity gives you no financial benefit.
What happens between original maturity and final maturity
After a bond reaches its original maturity date (20 years), it enters what the Treasury calls the extended maturity period. During this time, the bond continues to earn interest, but at a much lower rate than it did during the first 20 years. This rate is set by the Treasury and changes periodically.
For example, a Series EE bond issued in 2004 would reach original maturity in 2024. From 2024 to 2034 (when it hits final maturity), it would earn a small amount of interest each month. But that rate is typically a fraction of what it earned in the first 20 years. The Treasury publishes these extended rates on its website, and they vary depending on when your bond was issued.
The extended maturity period exists because some people hold bonds for longer than 20 years, and the Treasury wants to give them some return on that money. But the rate is deliberately low to encourage people to cash in their bonds and move the money elsewhere once the original maturity date passes.
How to find your bond's maturity dates
You can look up the exact dates for any bond you own by using the Treasury's Savings Bond Calculator, available on TreasuryDirect.gov. You will need the series (EE or I), the denomination, and the issue date. The calculator will tell you the original maturity date, the final maturity date, and the current value of the bond.
If you own paper bonds, the issue date is printed on the bond itself. If you own electronic bonds through TreasuryDirect, you can log into your account and see the issue date listed for each bond. Once you have that date, the maturity dates are easy to calculate: add 20 years for original maturity and 30 years for final maturity.
You can also call the Treasury's customer service line at 1-800-553-2663 if you have questions about a specific bond or need help finding your issue date.
What to do with a bond that has reached final maturity
Once a bond reaches final maturity, it stops earning interest and has no reason to stay in your possession. The Treasury recommends cashing it in as soon as possible after final maturity, because holding it longer gives you no benefit. The value will not grow, and you are simply keeping money in an account that is not working for you.
If you own paper bonds, you can cash them at most banks. Bring the bond itself and a form of ID. The bank will verify the bond and pay you its final value. If you own electronic bonds through TreasuryDirect, you can redeem them directly through your online account. The money will be deposited into your linked bank account within a few business days.
If you have lost a paper bond or cannot find it, you can file a claim with the Treasury's Bureau of the Fiscal Service. The process takes time, but you can recover the value of the bond if you can provide proof of ownership, such as the original purchase receipt or a bank statement showing the purchase.
The difference between cashing in early and waiting until maturity
You can cash in a Series EE or Series I bond at any time after you have owned it for five years. If you cash it in before the five-year mark, you lose the last three months of interest as a penalty. But once five years have passed, you can redeem it without penalty and receive its full current value.
The question many people face is whether to cash in a bond before final maturity or hold it until the end. If your bond is still earning a decent rate during the extended maturity period, holding it might make sense. But if the extended rate is very low (which it often is), you would likely earn more money by cashing it in and putting the money into a high-yield savings account or a money market fund.
The Treasury does not penalize you for cashing in before final maturity, so the decision is purely about where you can earn the best return on your money. Compare the extended maturity rate your bond is earning to the rates available in other savings products, and choose based on which one gives you more growth.
Why the Treasury sets maturity dates
The Treasury uses maturity dates to manage its debt and keep its records organized. Bonds are a form of borrowing: when you buy a bond, you are lending money to the federal government. The Treasury promises to pay you back with interest by a certain date. Once that date arrives, the Treasury's obligation to you is complete.
If bonds could earn interest forever, the Treasury would have to track millions of old bonds indefinitely and keep paying interest on them. By setting a final maturity date, the Treasury can close out the bond and move on. This is standard practice for all government and corporate bonds, not just U.S. savings bonds.
From your perspective, this means you need to pay attention to your bond's maturity dates. Missing the final maturity date does not cost you money directly, but it means your money stops growing and you are not earning any return on it. Keeping track of when your bonds mature helps you make decisions about when to cash them in and where to put the money next.
Frequently Asked Questions
Can I cash in my bond after it reaches final maturity?
Yes. A bond that has reached final maturity can still be cashed in at any time. The value will be whatever it was on the final maturity date, and it will not have grown since then. You should cash it in as soon as possible after final maturity, because holding it longer serves no purpose.
What is the difference between original maturity and final maturity?
Original maturity is when the bond stops earning its regular interest rate (20 years for EE and I bonds). Final maturity is when the bond stops earning any interest at all (30 years). Between those two dates, the bond earns a lower extended rate set by the Treasury.
If I lose my bond after it matures, can I still get the money?
Yes, but you will need to file a claim with the Treasury's Bureau of the Fiscal Service. You will need to provide proof of ownership, such as a purchase receipt or bank statement. The process can take several months, but you can recover the bond's value if you can prove you owned it.
Should I hold my bond until final maturity or cash it in earlier?
That depends on the interest rate your bond is earning during the extended maturity period and what other savings options are available to you. Compare your bond's extended rate to the rates on high-yield savings accounts or money market funds. If another option pays more, cash in the bond and move the money there.
Do I owe taxes when a bond reaches maturity?
You owe federal income tax on the interest your bond earned, but the tax is due when you cash it in, not when it reaches maturity. You can delay cashing it in to delay paying the tax, but once final maturity arrives, the bond stops earning interest, so there is no financial benefit to waiting.