Early Redemption

• You may cash the bonds after one year, but you will pay a penalty. The Treasury will subtract three months of interest from your purchase price plus interest earnings. Note that the purchase price of paper bonds equals only half the face value.
  
  

Redemption Without Penalty

• You may redeem EE bonds without penalty after five years. You will receive the purchase price plus interest. Redeem electronic bonds through Treasury Direct. Redeem paper bonds through your bank. If you want to redeem more than $1,000, have the bank help you send your bonds to a Treasury Retail Securities Site.
  
  

Redemption in Disaster Areas

• The government allows early redemption without penalty if you live in an area with a qualifying disaster such as, for example, a hurricane or flood. The Department of the Treasury makes information about such areas available on the "Press Room" page of the Treasury Direct website.