You can’t be blamed for not knowing where or how to invest in Treasury bonds or much about this kind of investment. For more than the past decade the interest rate from Treasury bonds has been terrible and you would have been better off keeping cash in a high-yield savings account (HYSA) or trying to ring some extra savings out of a certificate of deposit (CD). But a confluence of things have made Treasury’s short-bonds, which are called Treasury Bills (T-Bills) exciting again! With the Federal Reserve initiating quantitative tightening, where they purchase fewer T-Bills, and raising their interest rate it makes the interest rate the U.S. government has to offer to pay the government’s debt higher than it has been in a long time. These T-Bills not only offer a higher interest rate than most HYSA but they come with a few tax advantages and T-Bills can be more liquid than most CDs and unlike corporate bonds, T-Bills are backed by the U.S. government making them one of the safest investments. I know I may be overhyping to say that T-Bills are ‘exciting’ but they are worth exploring as a place to park your cash while saving for a near-term purchase, like a house or car that you don’t want to risk in the chaotic stock market.
Advantages of T-Bills
If you have set cash aside and don’t want to risk losing it in the stock market, but you want to be…
