Invest in the United States: Treasury Bonds
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Previously, we gave a run-down of the investing atmosphere in the United States and the US stock market. We now turn our attention to US Treasury Bonds, which are bonds issued by the US Federal Government.
US Treasury Bonds
Treasuries (bonds issued by the US government) are classified into three: treasury bills, notes, and bonds (see comparison table below). According to Yahoo! Finance, the US government has never defaulted on a loan, making it the safest investment around. Because there’s an almost nil chance of the US Treasury collapsing, you can be sure that your money is invested in a reliable place. However, this kind of assurance comes at the price of profit – US treasuries have low yields.
|
Kind of Bond |
Maturities |
Interest Payment |
| Treasury Bills ("T-Bills") | 91 days, 182 days, 364 days | none (purchased at a discount) |
| Treasury Notes (“T-Notes”) | 2 years, 3 years, 5 years, 10 years | twice a year |
| Treasury Bonds (“T-Bonds”) | 30 years (usually) | twice a year |
Treasury bills, notes, and bonds can be bought through a broker or directly from the US government. More often than not, purchasing bonds directly from the government is cheaper, because you don’t have to pay for the broker’s services. You can set up an account at the website of the Treasury Direct program of the US government.
Next: Investing in the United States: Foreign Investment
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