It’s been a long time since you could make an easy, safe 5% on your money. But the federal government now offers that option through the sale of Treasury bills.
T-bills range in maturity from one month to one year. The return on T-bills has soared during the Federal Reserve’s recent rate-hiking campaign. For example, you can get a six-month Treasury bill that will return around 5.5%.
Because the federal government backs T-bills, they are as close to risk-free as you can get in this world.
If you are a newbie who wants to get in on the action, know that there are two primary ways to purchase T-bills.
Option No. 1 is to buy T-bills is through the federal government’s TreasuryDirect website. Once you establish an account on the site, you can click “BuyDirect” and select “Bills” under “Marketable Securities.” At that point, you choose the term, auction date and purchase amount.
You can also purchase T-bills through a brokerage account. You can log on to your brokerage account for more information about how to complete your purchase there.
Each option has its pros and cons. For example, buying through TreasuryDirect might result in lower fees and expenses. On the other hand, buying through a brokerage account can make it easier to sell your T-bills before maturity.
If you are unsure about whether T-bills should be part of your portfolio mix, talk to your financial pro about the wisdom of using this strategy. If you don’t currently work with such a pro, stop by Money Talks News’ Solutions Center and find a great financial adviser.
Add a Comment
Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.