Buy treasury bills (t-bills) through reputable online banks & brokers; a simple, convenient way to invest with no fees and backed by the government.
How to buy treasury bills
You can buy T-Bills one of two ways:
Through TreasuryDirect. Investors who purchase T-Bills through TreasuryDirect are required to hold the bill for at least 45 days before transferring or selling it.
Through a bank or broker.
Best banks & brokers that offer access to treasury bills
1 - 4 of 4
Paid non-client promotion. Finder does not invest money with providers on this page. If a brand is a referral partner, we're paid when you click or tap through to, open an account with or provide your contact information to the provider. Partnerships are not a recommendation for you to invest with any one company. Learn more about how we make money.
Finder is not an adviser or brokerage service. Information on this page is for educational purposes only and not a recommendation to invest with any one company, trade specific stocks or fund specific investments. All editorial opinions are our own.
Other ways to buy treasury bills
Gain exposure to Treasury Bills through ETFs
In addition to purchasing T-Bills directly from the Treasury Department or via a bank or broker, it’s possible to gain exposure to the price and yield performance of T-Bills through exchange-traded funds (ETFs). Some T-Bill ETFs include:
SPDR Bloomberg 1-3 Month T-Bill ETF (BIL)
SPDR Bloomberg 3-12 Month T-Bill ETF (BILS)
Best brokers that give you access to Treasury Bills through ETFs
Get $100 - $2,000 when you open and fund an account with $5,000 to $100,000+
What are Treasury Bills?
The US government sells T-Bills to raise money to help fund its debt and its day-to-day operations. When you buy a T-Bill, you are giving the US government a short-term loan. In return, you receive an interest payment when the bill matures. A Treasury Bill (T-Bill) is a type of short-term US debt security with a maturity of one year or less. They’re one of five types of Treasury marketable securities, which are securities that can be transferred or sold before they reach the end of their term. The Treasury Department sells T-Bills in $100 increments with a maximum purchase of $10 million in noncompetitive bids.
T-Bills are widely regarded as a safe investment, as they’re backed by the full faith and credit of the US government.
Term options
4, 8, 13, 17, 26 and 52 weeks
Interest rate
Fixed at auction
Interest paid
At maturity
Minimum purchase
$100 to $1,000
Maximum purchase
$10 million in noncompetitive bids
Taxes
Federal tax due on interest earned
No state or local taxes
Treasury Bills vs. bonds
Treasury Bills are a type of short-term debt security issued by the US government, while bonds are a long-term debt security issued by governments and corporations.
Pros and cons of treasury bills
Pros
Near zero-risk since T-Bills are backed by the US government
Low investment minimum of $100
Fixed interest rate means stable income
No state or local taxes on interest income
Purchase T-Bills through the Treasury Department or through a bank or broker
Cons
T-Bills pay no interest leading up to maturity, only at maturity
Fixed interest rate means interest rate risk, so their rate could fall out of favor during periods of rising interest rates
Bottom line
With a low risk of default, low investment minimum and short time horizon, T-Bills may be an appealing place to invest. In an environment where shorter-term yields are higher than longer-term yields, T-Bills may be even more attractive. But they don’t come without disadvantages. Periods of rising interest rates may make existing T-Bills less attractive, but this won’t matter if you plan to hold the bill until maturity.
Frequently asked questions about T-Bills
Treasury Bill interest rates fluctuate and are fixed at auction. According to TreasuryDirect data as of March 6, 2023, the yield for a 52-week Treasury Bill issued on February 23, 2023 is 5.046%.
The interest income earned from T-Bills is subject to federal income tax but not state or local taxes. Interest earned on a T-Bill is paid at maturity and thus tax-reportable in the year in which it's received.
You can hold a T-Bill until maturity or sell it early without penalty. However, T-Bills pay interest only at maturity and only investors who hold a T-Bill to maturity are guaranteed to receive the face value of the bill. Because T-Bill prices fluctuate, investors who sell a T-Bill before it matures may get an amount different from what they paid. For example, if interest rates have risen since the bill was purchased, you may have to sell at a loss. The reason for the loss? Your existing T-Bill with the lower rate becomes less attractive compared to new T-Bills issued at higher rates. On the other hand, you may be able to sell at a premium if interest rates have fallen.
A Treasury Bill is a short-term debt security issued by the US Treasury Department. Investors who hold a T-Bill until maturity are paid the face value of the bill, which could be more than what they paid for it. This difference is the T-Bill's interest rate.
A Treasury Bill can be a good investment if you seek safety and a stable return.
Matt Miczulski is an investments writer at Finder, where he covers market news and digs into brokerages and investments to help readers make informed financial decisions. His expertise and writing have been featured on CBS, MSN, Best Company and Consolidated Credit, among others. Before joining Finder, Matt covered everything from finance news and banking to debt and travel for FinanceBuzz. He earned a BA in history from William Paterson University.
How likely would you be to recommend finder to a friend or colleague?
0
1
2
3
4
5
6
7
8
9
10
Very UnlikelyExtremely Likely
Required
Thank you for your feedback.
Our goal is to create the best possible product, and your thoughts, ideas and suggestions play a major role in helping us identify opportunities to improve.
Advertiser Disclosure
finder.com is an independent comparison platform and information service that aims to provide you with the tools you need to make better decisions. While we are independent, the offers that appear on this site are from companies from which finder.com receives compensation. We may receive compensation from our partners for placement of their products or services. We may also receive compensation if you click on certain links posted on our site. While compensation arrangements may affect the order, position or placement of product information, it doesn't influence our assessment of those products. Please don't interpret the order in which products appear on our Site as any endorsement or recommendation from us. finder.com compares a wide range of products, providers and services but we don't provide information on all available products, providers or services. Please appreciate that there may be other options available to you than the products, providers or services covered by our service.
