How to buy Treasury Bonds

T-bonds are U.S. Treasury bonds. They pay a fixed interest rate and are low-risk securities. You are basically making a loan to government and the government will pay you back with interest.

These are some basic information about Treasury bonds:

• 
  They are available in either 20- or 30-year terms.
  

• 
  These can be bought in increments of $100.
  

• 
  Treasury bonds earn interest semi-annually (every six month) until the end.
  

• 
  These investments are low-risk and long-term, and they’re guaranteed by the U.S. government.
  

Current rates for bonds of 20- and 30 year durations are 4%. They will be updated in February 2023.

T-bonds can be purchased directly from the U.S. Government. However, the best way to add them to your portfolio is through mutual funds and Treasury exchange-traded funds.

You can buy bulk government bonds on a brokerage platform using mutual funds or exchange-traded funds. An exchange-traded funds, or ETF for short, is a collection of investments, such as stocks and bonds, from which you can purchase as many or as little shares as you wish. Treasury ETFs invest only in U.S. Treasury securities and can be purchased and sold just like any other ETF. Mutual funds, like ETFs are another way for investors to pool their resources to gain exposure to many securities without the need to buy or manage them.

Nicholas Juhle is a certified financial analyst at Greenleaf Trust and chief investment officer. ETFs are mutual funds that allow you to have a variety of Treasury bonds at different maturity times, and have them managed for your convenience.

“There is a system. He says that when the bonds mature, they will roll it back into new Treasurys.

Juhle suggests looking at the prospectus to find out what an ETF or mutual fund contains.

Juhle states that each mutual fund or ETF will have a prospectus which explains exactly what can be held. This might be, for example, whether the fund holds 80% or 100% T-bonds.

You can bypass brokers and purchase direct from the government by having these three pieces of information available: A taxpayer identification number (or Social Security number), a U.S. postal address, and a checking/savings account to link to payment.

To get started:

2. 
   Select the type of account that you want: individual, business, or organizational, or estate or trust account.
   

3. 
   Personal information such as a taxpayer identification number (or TIN), a U.S. postal address, and a bank account.
   

4. 
   To open a TreasuryDirect account, create a username and password.
   

5. 
   After your account has been verified, you can open it and click on the Buy Direct tab.
   

6. 
   Please specify the security that you would like — in this instance, Treasury bonds — as well as the amount you wish to purchase.
   

7. 
   Choose to buy.
   

The yield is automatically deposited in your account when the bond matures.