WASHINGTON — Say so long to paper.

The federal Treasury Department plans to convert paper U.S. savings bonds to electronic accounts within the next three years.

“This is an important step in our efforts to modernize the savings bond program through e-commerce,” Treasury Under Secretary for Domestic Finance Peter R. Fisher said in a written statement. “Our goal is to transform the savings bond program from one based on paper certificates to accounts accessed safely, and conveniently over the Internet.”

While that may mean dramatic changes for civilian investors, military personnel likely will notice little difference.

Defense Finance and Accounting Service Disbursement Technician Coultier Hillman Jr. said Tuesday from his civilian office in Indianapolis that most military personnel buying savings bonds — EE or I series — already do so electronically through the agency’s “safekeeping” program.

Hillman estimated that 30 percent of military personnel invest in savings bonds during their service.

Under the safekeeping program, personnel in the Army, Navy, Air Force and Marine Corps can buy electronic bonds and have them stored as such through their respective branch of the military, he said.

“We still mail [paper] bonds, but it’s down from large numbers to small numbers,” Hillman said, adding savings-bond investors consider electronic accounts “efficient.”

While paper notes no longer will be available to purchase once the transformation is complete, their electronic replacements will be available online from a federal Web site, federal officials say.

Paper notes will remain redeemable indefinitely.

Buying bonds electronically eliminates the “goof-ups of paper bonds being undeliverable,” Hillman said. “Electronic bonds are safer. A lot of soldiers have turned the corner and say ‘store them [electronically] for me.’”

Hillman says he expects the major difference troops to see after savings bonds become electronic will be in how they are redeemed.

Currently, military personnel cash in electronic bonds by requesting paper bonds be issued, he said. The bonds are printed at a Federal Reserve Bank then mailed to investors for redemption at banks and credit unions.

Although an electronic bond redemption system for troops has yet to be set up, the Treasury Department already has an electronic bond program available called Treasury Direct.

Treasury Direct allows investors to buy EE bonds online and redeem them through an electronic-funds transfer to a designated financial account, such as checking or savings accounts.

“It’ll also save the government paper, time and space,” Hillman added.

Information on Treasury Direct is available at

Military personnel and other investors also may note differences in buying bonds for gifts.

Neither Hillman nor officials at National Military Family Association can say what those differences will be; they’re waiting to see the Treasury Department’s plan.

Treasury officials currently are developing the system, which they say likely will be similar to its Treasury Direct program.

More information about investing in U.S. Savings Bonds is available from Defense Finance and Accounting Service representatives within each service or online at

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