Which of my Savings Bonds should I cash in?
Monday, December 20th, 2004
Categorized as: Cashing in US Savings Bonds
I have to cash in some savings bonds. To decide which ones to cash in, do I use the rate or the yield? Is it better to cash in the most recent ones having earned little interest or older ones?
It's a great idea to take some time to figure out which of your Savings Bonds to cash first. Readers of my book, Savings Bond Advisor, have access to an exclusive Alert Recommendation for each savings bond issue date that can help you make this decision.
In general, cash in the ones with the lowest rate, which compares how your bonds will do in the future. The yield is the bond's lifetime yield, which tells you which ones did best for you in the past, but often the ones with strong past results will have weak future results because of the way rates are calculated on older bonds.
If you have EE bonds that were issued within the last five years, try to get as many as possible to the five-year mark before you cash them. This often means cashing the ones you purchased most recently first.
For I bonds, cash the ones with the lowest fixed-base rates.