Maturity timelines depend on the bond type and the rate it was issued at
Series EE savings bonds reach final maturity (the point at which they stop earning interest) 30 years after issue. Series I savings bonds also mature at 30 years. However, both types reach original maturity — when they stop earning their initial rate — at 20 years. After that, they earn a new rate for the remaining 10 years until final maturity.
The practical difference matters: if you hold an EE bond past 20 years, you are not getting the rate you bought it for anymore. The Treasury sets a new rate every six months (in May and November) and applies it to all bonds that have hit their 20-year mark. You keep earning interest, but at whatever the current rate is, not the original one.
If you need the money before maturity, you can cash in a bond after holding it for one year. However, if you cash it in before five years have passed, you lose the last three months of interest as a penalty. After five years, there is no penalty.
Key Takeaways
- EE and I bonds both reach final maturity at 30 years from the issue date, but stop earning their original rate at 20 years.
- You can cash in a bond after one year, but lose three months of interest if you do so before the five-year mark.
- After five years, you can cash in without penalty, though you will still receive less than if you held it longer.
- The Treasury resets the interest rate every six months for bonds that have passed their 20-year anniversary.
What happens at the 20-year mark
When a savings bond reaches 20 years old, it stops earning the rate printed on the bond itself. The Treasury then assigns it a new rate based on what it is paying on new bonds issued that month. This new rate applies for the next 10 years, until the bond reaches final maturity at 30 years.
The new rate is often lower than the original rate, especially if you bought the bond during a period of higher interest rates. For example, an EE bond issued in 2000 earned 5.9% for its first 20 years. When it hit the 20-year mark in 2020, it was reassigned to the rate in effect that month, which was much lower. This is why some people cash in bonds right before or after the 20-year anniversary — to lock in the interest earned so far rather than accept a lower rate for the final decade.
Early redemption and the three-month penalty
You can redeem a savings bond at most banks or through TreasuryDirect (the federal government's online bond platform) once you have owned it for at least one year. However, if you cash it in before five years have passed, the Treasury withholds the last three months of interest as a penalty.
This penalty applies to both EE and I bonds. If you bought a bond on January 15, 2023, you could cash it in on January 15, 2024 (one year later), but you would lose interest from October 15, 2023 onward. If you wait until January 15, 2028 (five years), you keep all the interest earned.
Cashing in after five years with no penalty
Once a bond has been held for five years or longer, you can cash it in at any time without losing any interest. The Treasury will pay you the current redemption value, which includes all interest earned up to the month you cash it in.
Interest on savings bonds is paid out in a lump sum when you redeem — you do not receive monthly or annual payments. The redemption value is the original purchase price plus all accrued interest. You can find the current value of any bond you own through TreasuryDirect by entering the bond's serial number.
Holding bonds past final maturity
Once a bond reaches 30 years (final maturity), it stops earning interest entirely. At that point, there is no financial reason to hold it. The Treasury will not automatically cash it in, so you need to redeem it yourself to access the money.
Many people forget they own bonds and discover them years or decades later. If you find an old bond that has reached final maturity, you can still cash it in at a bank or through TreasuryDirect. The value will be whatever it was worth on the day it hit 30 years — no additional interest will have accrued since then.
Comparing EE and I bonds on timeline
Both bond types follow the same maturity schedule: 20 years to original maturity, 30 years to final maturity. The difference is in how interest is calculated and paid. EE bonds are sold at a discount (you pay $50 for a $100 bond) and the interest is the difference between what you paid and what you cash it in for. I bonds are sold at face value and the interest rate is printed on the bond itself.
For timeline purposes, treat them the same: one year before you can cash in, five years before you can cash in without penalty, 20 years before the rate resets, and 30 years before interest stops accruing entirely.
Frequently Asked Questions
Can I cash in a savings bond before one year?
No. Both EE and I bonds must be held for at least one year before you can redeem them. If you need the money sooner, you cannot access it through the bond.
What is the difference between original maturity and final maturity?
Original maturity (20 years) is when the bond stops earning its initial rate. Final maturity (30 years) is when it stops earning interest altogether. Between years 20 and 30, the bond earns a new rate set by the Treasury every six months.
Do I lose money if I cash in a bond early?
You do not lose the principal you invested, but you lose three months of interest if you cash in before five years. After five years, you keep all interest earned. The longer you hold, the more you earn.
What happens if I forget to cash in a bond after 30 years?
The bond stops earning interest at 30 years, but it does not expire or become worthless. You can cash it in at any time after that and receive the value it had on the 30-year anniversary. No additional interest accrues after final maturity.
Can I find out what rate my old bond will earn after 20 years?
No, the rate is not set until the bond reaches 20 years. The Treasury announces new rates every six months, so you will know the rate only when your bond hits that milestone and the new rate takes effect.