Bonds are a popular investment option for those seeking to earn a fixed rate of return on their money.
Buying bonds directly from the U.S. Treasury is a straightforward process that can provide investors with a safe and stable source of income.
By understanding the different types of bonds sold by the Treasury, investors can choose the best bond to meet their investment goals.
Here’s a guide on how to buy bonds directly from the U.S. Treasury and the types of bonds sold by the Treasury.
Create your account
To purchase bonds directly from the U.S. Treasury, you will need to create an account with Treasury Direct, which is the Treasury’s online platform for buying and managing bonds.
Once that is done, determine the type of bond you want to buy.
The Treasury offers different types of bonds, each with different features and maturity dates. You will need to decide which bond is right for you based on your investment goals.
The types of bonds sold the Treasury include:
- Treasury Bills (T-Bills): T-Bills are short-term bonds that mature in less than one year. They are sold at a discount to their face value and offer a fixed rate of return.
- Treasury Notes (T-Notes): T-Notes are intermediate-term bonds that mature in 2, 3, 5, 7, or 10 years. They pay a fixed rate of interest every six months.
- Treasury Bonds (T-Bonds): T-Bonds are long-term bonds that mature in 20 or 30 years. They pay a fixed rate of interest every six months.
- Treasury Inflation-Protected Securities (TIPS): TIPS are bonds that are designed to protect investors from inflation. They pay a fixed rate of interest plus an additional adjustment for inflation.
- Series EE Savings Bonds: EE Savings Bonds are a type of savings bond that accrue interest for up to 30 years. They are sold at a discount to their face value and offer a fixed rate of return.
- Series I Savings Bonds: I Savings Bonds are another type of savings bond that offer protection against inflation. They pay a fixed rate of interest plus an additional adjustment for inflation.
Make a purchase
Once you have decided on the type of bond you want to buy, you can make a purchase through your Treasury Direct account.
You will need to enter the amount you want to invest and follow the instructions to complete the purchase.
