T-Bills are Looking Sexy

Posted on 03. Mar, 2006 by in Saving & Investing

treasurydirectlogo.gifIf you’re looking for a place to put your hard-earned cash that isn’t located under a mattress or in a mason jar, T-Bills might be the way to go.

U.S. Treasury bills – or T-Bills – are government obligations that mature in a year or less. Current yields are around 4.5% which are looking very comperable to other investing instruments including savings accounts and short-term CDs. And the best part is that the interest is free from state and local income taxes.

Recently, the government has made it very simple to buy T-Bills and long-term Treasury bonds through the new website TreasuryDirect.gov by offering online access to the Treasury-security auctions which are held several times each month. You can purchase T-Bills using your bank account and setting up an account is fairly easy. In addition, when the debt matures it is directly deposited into the account you specify.

If you are hesitant to purchase Treasury bonds directly form the government or in an auction setting, you can always purchase them through a normal brokerage account. There are a few advantages and disadvantages that come from going through a broker. For example, if you puchase Treasury bonds through a broker you can maintain all of your investments in one spot on one statement. However, the fees that brokers charge can also be outrageously high. As always, trading through a broker is a personal decision and should be made carefully.

In any case, T-Bills look like a very good investment at this time before rates climb any higher. Be sure to check out TreasuryDirect.org or ask your broker about T-Bill offerings.

One Response to “T-Bills are Looking Sexy”

  1. Helen G. Miller

    11. Jul, 2007

    I am trying , unsuccessfully, to buy Treasury Notes or
    bills.

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