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Converting Series I Paper Bonds into Electronic Bonds

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Savings BondsSince I couldn’t buy electronic Series I bonds in time because of user error, I went to the local bank and purchased paper Series I bonds instead. The next step is to convert the paper bonds into electronic bonds and the Treasury Department makes that pretty easy.

Why Convert?

I’m converting because I don’t want to lose the certificate. If you lose the bond, you can always replace it by filling out Form PDF 1048 Claim For Lost, Stolen or Destroyed United States Savings Bonds but if the conversion process is easy, why risk it?

Another good reason to convert is that you’re able to redeem the bonds in any increment, you aren’t restricted to the increments you converted. The only rule is that you must redeem at least $25 and what’s left can’t be less than $25, which shouldn’t be an issue.

Lastly, after thirty years, the bonds are automatically redeemed. There’s no chance you’ll find the bonds in the attic somewhere in sixty years, after missing out on thirty years of interest. (there are more reasons and I just realized they have them listed on the SmartExchange site, so check them out there if you’re not convinced)

How To Convert

The system TreasuryDirect uses is called SmartExchange. Anyone with a TreasuryDirect account can convert paper bond certificates into electronic bonds (if you don’t have a TreasuryDirect account, open one… it’s easy but it takes a week or two to get everything all set up).

The next step is to log into your account and use their Contact feature to notify TreasuryDirect that you’d like to convert your bonds. Then, after a few days you’ll receive this email confirmation:

Hello.

You can now create your own conversion linked account by following these steps:

* Access your TreasuryDirect account.
* Click the ManageDirectsm tab.
* Select the “Establish a Conversion Account” option from the Manage My Linked Accounts menu. The Establish a Conversion Account page will display. Review the information.
* If you wish to create a Conversion Linked Account, click the Create Account button

The next few instructions are just as the email describes except instead of looking for a “Establish a Conversion Account” you’re actually looking for “Establish a Conversion Linked Account.” On that next page, click on Create Account and with that, you have created a Conversion Linked Account! (* Welcome to your new Conversion Linked Account! You may begin converting your paper bonds at any time. Yay!)

The process from here is simple and mechanical with detailed instructions available on the TreasuryDirect site in the ManageDirect page. You will essentially create a list of bonds, print out a manifest, and mail in the bonds (there’s no point in me republishing the actual details, they give step by step instructions). The process takes about three weeks once they get the bonds and you can track it by viewing your electronic manifest through ManageDirect. Use that to track the status of your bonds.

As an aside, having logged into TreasuryDirect about a million times in the last few days, I have to say the security access card is a pain in the rear. Luckily if you fail too (3?) many times (I kept forgetting to pick a serial number), they report that you failed but don’t actually lock you out. You can just keep trying, great security!

(Image by joan_thewlis)

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6 Responses to “Converting Series I Paper Bonds into Electronic Bonds”

  1. Thanks for this Jim! I was actually just given a paper bond as a wedding present (i didn’t know people STILL did that), and was thinking about converting it over, along w/ some oldies from back in the day.

    I’ll have to print this out and use it – thx again :)

  2. Ceo Reom says:

    Wow. You read my mind like an open book…..the answer came before I even asked the question! Thanks :)

  3. William Mcdermott says:

    thanks for the columnm. I was looking ror that info on partial redemption. I have acouple of eebons i plan to convert to elontric bonds .I may buy some tips since they are exempt from state and locl taxes. Also theres no limit on purchas for the average person maybe Tiger Woods. Thanks again Bill.

  4. ziglet19 says:

    Just wondering – I actually only have one bond. Do you think it’s worth it to go through the process to convert?

    • Jim says:

      One paper bond? I went through the process so I could manage it all online, rather than having papers I could lose or forget about.

      • ziglet19 says:

        I should probaby convert. I actually just found the bond the other day and had forgotten about it.


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