My father was having five savings bonds in various denomination and maturity durations. I asked him how to cash savings bonds and he said that when the amount matures after the maturity period reaches, we can cash the savings bond from the bank. He also said that we can avail loans from the bank by using the savings bonds. I was curious to know the interest rates given for the savings bonds as an investment and found that that the interest rate offered by the banks on the savings bonds was very low and when a person gets a loan based on the bond document, they will be charged a higher interest rate on the loan and the loan amount given will be less than the invested amount. The loan obtained on the bond document is a total waste and one has to pay more on the loan interest rate rather than the savings rate earned. I intimated this to my father and he accepted the fact and never thought about getting a loan using the bond document.

Then I asked him how to cash savings bonds in case of emergency. My father said that he knew that bonds can be withdrawn only after the maturity period and hence has divested his investments in bank savings deposits and share market but when talking about the savings bonds, he said that he invested them in various maturity periods and if the amount is needed in emergency then the bond document with the smallest duration period can be withdrawn with some penalty in the interest rates and will take around a week to receive the amount in our account. How to cash savings bonds when medical expenses occur? In case of medical emergency, my father told that the bond investments are a total waste but can be pledged with some other person and the amount can be received from them in exchange for the document without any interest rate. Most of the financial institutions and the individual finance persons will buy the bond certificate without interest and give the amount immediately. I received answers to all my questions in how to cash savings bonds and feel that for a long term purpose, investments in savings bonds will be perfect and will not suit most of the young and teen age investors who expect higher return on the investments that they make in the share market.