How to Recover Lost US Savings Bonds

Here’s a drawback to US savings bonds that you might not have considered: Savings Bonds are easy to forget about. Paper savings bonds are often left in safe deposit boxes and forgotten. Electronic savings bonds do not generate a paper trail either – no monthly statements, no annual tax forms, nothing. There is not even a reminder when they mature and stop earning interest. If something unexpected happens to the owner, it’s quite possible nobody else will realize the savings bonds are still there, perhaps still compounding away.

How many have been forgotten? The US Treasury is currently sitting on over $25 billion in matured, unclaimed U.S. savings bonds. This is according to the WSJ article States Battle Treasury Over Billions in Unclaimed Savings Bonds (paywall?).

Three Missouri sisters from a Russian immigrant family—Bessie, Anna and Mary Segal—socked away money into U.S. savings bonds for decades starting in the 1940s, investing $25 or $50 at a time.

They never married and by 1998, all three had died, with little money to their names. What the sisters didn’t realize was that those bonds, stored and forgotten in a Kansas bank, had turned into more than $670,000.

Most of that article is about how individual states are fighting with the federal government over who gets the manage the forgotten savings bonds. Both sides talk about fighting for us “little guys”, but the another incentive is that the winner also gets to keep whatever is left over as unclaimed property… again, billions of dollars.

Here’s how to recover lost savings bonds for you and or your relatives, including those gifted to you in the past. Do it as soon as possible, as there may soon be a countdown after which the state will eventually take the money for themselves as unclaimed property.

  • Click here and download Form FS Form 1048 (PDF direct link), “Claim for Lost, Stolen, or Destroyed United States Savings Bonds”. This used to be called Public Debt Form 1048.
  • You will need to fill it out to the best of your ability to help them in a manual search. Ideally you would have the serial numbers, but include all of the information that you can gather. Your name and Social Security Number, the giver’s name and SSN (parent? aunt/uncle? grandparent?), addresses, former addresses, middle initials, etc. If you don’t know something, just leave it blank.
  • Indicate whether you would like a replacement savings bond or direct deposit of the value into your bank account.
  • Obtain a medallion signature guarantee from a financial institution in order to verify your identity.
  • Mail it to the specific PO Box address listed at the bottom of the form. There is no fee.

Kathryn Davenport Bernard was surprised to learn in 2017 from a Kentucky law firm that she could collect on bonds found in the name of her uncle, Roger Lovelace, who died during World War II when she was a girl.

After several months of paperwork, Ms. Bernard and her twin sister each got a $1,300 check. “I just squirreled it away,” she said of the unexpected funds.

If you have existing savings bonds, be sure to create a backup list of all your bonds including purchase date, amount, owner info, and serial numbers. Here is the TreasuryDirect page on what happens upon the Death of a Savings Bond Owner, which applies to paper bonds only.

If you have electronic savings bonds in a TreasuryDirect account, be sure to keep a record of those as well. The TreasuryDirect website directs you to contact the Bureau of Fiscal Service directly if you know of someone with an online account that has died. They will put a hold on the account and give specific instructions for the situation.

Pre-emptive selling? While putting together my other estate documents, I realized that this complexity may not only be a hassle to my loved ones, but if they forget they may lose access to the money completely. Therefore, if I find myself in a year with relatively low income (and thus a lower tax bracket), I will probably sell off all my paper savings bonds and possibly my electronic ones as well. Savings bonds have been a useful tool in building up my investment portfolio, but they are not the best fit if you don’t keep detailed records and/or your family is not adept in navigating bureaucracy.

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