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Electronic Payroll Savings FAQs

What is TreasuryDirect?

TreasuryDirect is a Web-based system that allows investors to establish accounts to purchase, hold, and conduct transactions in Treasury securities online. You can purchase electronic Series EE and I savings bonds as well as Treasury bills, notes, bonds and Treasury Inflation-Protected Securities (TIPS) through TreasuryDirect. Paper savings bonds are not sold through TreasuryDirect.

How does this change payroll savings?

TreasuryDirect offers an electronic alternative to the traditional payroll savings plan. You establish your own TreasuryDirect account and, with direct deposit (payroll) deductions that are just like any other direct deposit deduction, purchase a Certificate of Indebtedness (C of I). The C of I is a Treasury security that does not earn any interest and is used as a source of funds to purchase electronic Series EE and/or Series I savings bonds as well as Treasury bills, notes, bonds and TIPS. You then access your account and use the C of I to schedule the purchase of the Treasury securities you desire.

How does TreasuryDirect work with payroll savings?

It's simple...

  • You open a TreasuryDirect account.
  • You submit a request to your employer for a direct deposit (payroll) deduction (an instruction sheet is available in TreasuryDirect under Manage Direct, View My Funding Options).
  • Your employer establishes a direct deposit deduction from your pay in the amount you request. Your deduction is used to purchase a Zero-Percent Certificate of Indebtedness (C of I), which does not earn any interest, but is used as a source of funds to purchase Treasury securities within your TreasuryDirect account.
  • You may buy a savings bond after accumulating a minimum of $25 in the C of I or you can buy a Treasury bill, note, bond or TIP after accumulating a minimum of $100.  You can also schedule a purchase in advance. The securities are then posted to your TreasuryDirect account.

What are the advantages of TreasuryDirect?

TreasuryDirect is an easy way for you to save on a regular basis by purchasing electronic Treasury securities. With TreasuryDirect:

  • You can buy, manage, and redeem Treasury securities online 24/7, all from the convenience of home or work, wherever you have secure Internet access.
  • You can establish multiple registrations in one account.
  • You can schedule recurring purchases for up to five years in advance.
  • Savings bonds purchased through TreasuryDirect are generally added to your account in just one business day.
  • When the funds are needed, after the minimum term of ownership has been reached, you can redeem part or all of a savings bond or savings bonds. The payment will be deposited to the checking or savings account you choose. Redemption funds should reach your bank or credit union in just one business day.
  • TreasuryDirect tracks details such as issue date and current value for you.
  • Since the savings bonds are electronic, there is no paper to lose, nor do you need to go to your local bank to redeem them.
  • You can even set up accounts for minor children, as well as custom accounts for specific purposes such as a vacation, within your TreasuryDirect account.
  • TreasuryDirect provides a summary of account activity, including recent purchases, payments, and account balance.

What is the minimum term of ownership?

Savings bonds must be held for a minimum of 12 months before they can be redeemed. Also, if you cash a savings bond within the first five years after it is issued, you give up the last three months' worth of interest.

Why would my employer offer TreasuryDirect in addition to a traditional payroll savings plan?

With TreasuryDirect your employer can provide you with the same benefit of automatic savings with significantly less work and, therefore, less cost. Your employer sends each deduction to TreasuryDirect each payday.

  • Your employer doesn't need to accumulate funds toward the purchase price of a savings bond.
  • You, not your employer, request the issuance of savings bonds.

I already participate in a traditional payroll savings plan. Can you automatically convert me to TreasuryDirect?

No, to participate in TreasuryDirect you must first open a TreasuryDirect account at www.treasurydirect.gov. The process of opening an account includes your selection of a password to safeguard your investments. With your account established, you submit a request – an instruction sheet is available in TreasuryDirect, under Manage Direct, View My Funding Options – to your payroll office for a direct deposit (payroll) deduction, providing your TreasuryDirect account number and the amount you want deducted from each pay.

My employer has a traditional payroll savings plan. Do I need to convert to TreasuryDirect?

No, you can continue to participate in your employer's traditional payroll savings plan as long as it is available. While Treasury's long-term direction is to eliminate paper savings bonds, no date has been established for doing so. While paper savings bonds are available, your employer may continue, but is not required, to offer the traditional payroll savings plan.

Can my employer offer both the traditional payroll savings plan and TreasuryDirect?

Yes, your employer may offer both at the same time. In fact, we recognize that employers may want to offer both as part of a strategy to move from a traditional payroll savings plan to TreasuryDirect. It is important to remember that the traditional payroll savings plan offers only paper savings bonds and TreasuryDirect offers only electronic securities.

Can I participate in both plans at the same time?

Yes, since the traditional payroll savings plan and TreasuryDirect are completely separate plans, you can participate in both at the same time if your employer offers both. It is important to remember that the traditional payroll savings plan offers only paper savings bonds and TreasuryDirect offers only electronic securities.

What information do I need to open an account?

In order to complete our easy, online application, you will need the following items on hand:

  • Your Social Security Number (Taxpayer Identification Number),
  • Your Driver's License Number or State ID and expiration date,
  • Your bank or credit union routing number and account number of the checking or savings account you'd like to use,
  • A valid e-mail address, and
  • A browser that supports our technical requirements. If you would like to download the latest browser versions available, visit http://www.treasurydirect.gov/indiv/help/128bit.htm. Once you have all this, you are ready to open your TreasuryDirect account.

Why must I enter a bank or credit union account when I open my TreasuryDirect account?

Your bank or credit union account information is part of how TreasuryDirect confirms your identity when you open your account. Also, if you redeem a security, TreasuryDirect will deposit the payment to the bank or credit union account you select.

How does TreasuryDirect confirm my identity?

TreasuryDirect confirms the information you furnish through commercially available databases.

How long will it take to verify my information?

Your personal information will be verified within one (1) minute after your TreasuryDirect account information has been submitted.

What if you are unable to verify my information?

If we are unable to verify your information, we will offer you the opportunity to complete a convenient, printable authentication form. You complete the form according to the instructions and submit it to the address we provide.

Is it safe to send all this information over the Internet?

Yes, the TreasuryDirect website uses several features to ensure the safety of the information you provide us, as well as the transactions you perform.

  • Secure Sockets Layer software with 128-bit encryption allows you to perform secure, online transactions. The software works by using a private, mathematical key to encrypt (or scramble) data that's transferred between the Web browser and our site. To verify that Secure Sockets Layer is working, check for a picture of a closed lock in the lower right-hand corner of the Internet Explorer browser. If you are using a Netscape browser, look for a solid key in the lower left-hand corner.
  • Once you've completed an online form to establish a new account, we verify the information you provided and send your TreasuryDirect account number via e-mail.
  • You establish your own TreasuryDirect password, and you can change it anytime. To log in to your account, you must use your password in combination with your TreasuryDirect account number.

I buy savings bonds in multiple registrations. How does this work in TreasuryDirect?

You establish each registration in your TreasuryDirect account. Registration refers to the name and Social Security Number (SSN) of the person(s) associated with a security and maintained on record. When you schedule a purchase or recurring purchase, you select the amount of the purchase and the registration desired. You can schedule one or more purchases with the same registration or multiple purchases with various registrations. For example, you can schedule a purchase on the 15th of each month for a daughter and on the 30th for a son or schedule a purchase for each on the 15th and 30th of each month.

In TreasuryDirect, do I need a separate deduction for each registration?

No, since the direct deposit (payroll) deductions are used to purchase a C of I within your TreasuryDirect account, one deduction can be used to cover purchases. You simply use the C of I as the source of funds when scheduling each purchase.

What is the smallest denomination savings bond I can buy in TreasuryDirect?

Electronic savings bonds are not sold by denomination. The minimum purchase in TreasuryDirect is $25 and the maximum is $5,000. In between, you can purchase any amount – down to the penny. There is a $5,000 annual limit per savings bond series per person.

Does a deduction need to be at least $25?

No, you can request a deduction of as little as a penny; however, your payroll system may have a minimum dollar amount on direct deposit deductions from your pay. The funds will accumulate in a C of I in your TreasuryDirect account until you make a savings bond purchase or a Treasury bill, note, bond or TIPS purchase.

When is the issue date established on a savings bond I buy in TreasuryDirect?

Savings bonds purchased in TreasuryDirect are posted to your account one business day after they are purchased. The issue date of the savings bond is the first day of the month in which the savings bond is posted. For example, if the purchase is made on May 31 and the savings bond posts on June 1, the issue date is June 1; but if the purchase is made on May 26 and the savings bond posts on May 27, the issue date is May 1.

What happens if I forget to schedule a purchase?

The C of I will remain in your TreasuryDirect account and will not earn any interest.

What happens if I stop my deduction, and the value of the C of I is not enough to buy a savings bond or other Treasury security?

You can redeem the C of I at any time, directing the payment to a checking or savings account at your bank or credit union.

What happens if I stop my deduction, but forget to stop scheduled future purchases of savings bonds or other Treasury securities?

When the C of I is insufficient to cover the purchase of a savings bond, the purchase will not take place. TreasuryDirect will notify you by e-mail.

To use TreasuryDirect, do I need to have Internet access and an e-mail account?

Yes, to use TreasuryDirect, you must have Internet access to log in to your TreasuryDirect account and an e-mail address to receive important messages from TreasuryDirect, including the receipt of your account number.

Does my employer need to provide Internet access to TreasuryDirect?

No, although we encourage employers to consider providing access to TreasuryDirect at the employee's workstation, in a break room, or through the payroll and benefits office, they are not required to do so.

How do I get started with TreasuryDirect?

Open your TreasuryDirect account. Instructions on setting up direct deposit (payroll) deductions can be found in "View my Funding Options" under the Manage Direct tab within the application. It's that simple.

Can I participate in TreasuryDirect without using direct deposit (payroll) deduction?

Absolutely! You can open a TreasuryDirect account and make purchases having TreasuryDirect debit your savings or checking account.

Are there other ways to contribute to the C of I besides direct deposit (payroll) deduction?

Yes, you can contribute to the C of I from pension funds, annuities, and even your checking or savings account. If you need to add to your C of I balance in order to purchase a savings bond or other Treasury security, you can contribute directly to the C of I from your checking or savings account. If you choose to use one of these methods to contribute to your C of I, contact the relevant institution. Also, you can redeem securities in your TreasuryDirect account to the C of I instead of to your bank account.