US Treasury bills are short-term loans to the federal government. You pay less than face value, the Treasury repays the full face value on a set date 4 to 52 weeks later, and the difference is your interest. Bills are one branch of a family of securities that runs out to 30-year bonds, and every branch can be held in up to four ways: in a TreasuryDirect account, at a brokerage, through a fund, or as a token on a blockchain.
All Treasury securities are backed by the full faith and credit of the United States, which is why they anchor so many cash reserves and bond portfolios. They still carry risks: prices move with interest rates, inflation can outrun the yield, and how quickly you can get your money out before maturity depends on where you hold it. Below are live bill rates and the yield curve, tables comparing every Treasury security, every way to hold one and the main alternatives for cash, and worked examples of the pricing and after-tax math, with a link to a deeper guide at each step.
What are US Treasury bills, notes and bonds?
They are debt securities the US Treasury sells to fund the federal government, and they differ mainly in how long they last and how they pay interest.
| Security | Term | How interest is paid | Minimum | Where to buy | State and local income tax |
|---|---|---|---|---|---|
| Treasury bills | 4, 6, 8, 13, 17, 26 and 52 weeks | Sold below face value; the full face value is paid at maturity | $100 | TreasuryDirect, banks and brokers | Exempt |
| Treasury notes | 2, 3, 5, 7 and 10 years | Fixed rate, paid every six months | $100 | TreasuryDirect, banks and brokers | Exempt |
| Treasury bonds | 20 and 30 years | Fixed rate, paid every six months | $100 | TreasuryDirect, banks and brokers | Exempt |
| TIPS | 5, 10 or 30 years | Fixed rate every six months, on a principal that rises and falls with consumer prices | $100 | TreasuryDirect, banks and brokers | Exempt |
| Floating rate notes | 2 years | Every three months; the rate resets weekly to the 13-week bill rate plus a fixed spread | $100 | TreasuryDirect, banks and brokers | Exempt |
| STRIPS | Up to 30 years | Nothing until maturity; bought below face value | $100 of face value | Banks, brokers and dealers only | Exempt |
| Savings bonds (EE bonds, I bonds) | Earn interest for up to 30 years | Interest is added to the bond's value and paid when you cash it | $25 | TreasuryDirect only | Exempt |
Bills are the workhorse of government borrowing. At the end of September 2026 the Treasury had $7.12 trillion of bills outstanding, about 22% of its $31.83 trillion in marketable debt, according to the Monthly Statement of the Public Debt. Notes were the largest category at $16.28 trillion. Savings bonds, at about $146 billion, are small by comparison because purchases are capped per person and the bonds cannot be traded.
Full faith and credit means the government pledges its full powers, including taxation, to repay. It does not mean the market price of a Treasury stays fixed before maturity. For the difference between those two ideas, see are Treasuries risk-free? and what the risk-free rate means.
Which Treasury fits your time horizon?
Match the maturity to the date you need the money, then decide whether inflation protection or a resetting rate matters to you.
- Cash you need within a year: bills. Pick a term that ends before the expense; T-bill terms compared weighs the seven options against each other.
- A known expense two to ten years away: a note maturing near that date locks today's yield for the whole period, provided you hold it to the end. Treasury notes explained covers coupons, auctions and pricing.
- Long horizons: 20- and 30-year bonds pay coupons for decades but swing the most in price. See Treasury bonds explained and short-term vs long-term Treasuries.
- Protection from inflation: TIPS add consumer price changes to principal, and I bonds pay a fixed rate plus an inflation rate. New I bonds currently earn a composite 5.51%, including a 1.40% fixed rate, and purchases are capped at $10,000 in electronic I bonds per person per calendar year. Compare them in I bonds vs TIPS and I bonds vs T-bills.
- A rate that follows bill yields: floating rate notes last two years, pay quarterly and reset weekly; see Treasury floating rate notes.
- One lump sum on a future date: STRIPS pay nothing until maturity, which suits a known future payment, though federal tax is due each year on interest you have not yet received. See Treasury STRIPS explained.
- Small, steady saving: new EE bonds currently earn a fixed 2.90%, and the Treasury promises each one will be worth at least twice its purchase price after 20 years. See EE savings bonds and how to cash savings bonds.
For a side-by-side view of the three main marketable types, see T-bills vs notes vs bonds.
What do Treasury bills pay right now?
The table below shows the latest closing rate for each of the seven bill terms, refreshed from Treasury data every business day.
| Term | Discount rate | Investment yield | Price per $1,000 | Yield vs a month ago | Yield vs a year ago |
|---|---|---|---|---|---|
| 4-week | 3.91% | 3.98% | $996.96 | +0.07 pts | 0.00 pts |
| 6-week | 3.91% | 3.98% | $995.44 | -0.04 pts | +0.04 pts |
| 8-week | 4.00% | 4.08% | $993.78 | +0.02 pts | +0.11 pts |
| 13-week | 3.99% | 4.08% | $989.91 | -0.05 pts | +0.23 pts |
| 17-week | 4.07% | 4.18% | $986.55 | -0.05 pts | +0.31 pts |
| 26-week | 4.11% | 4.25% | $979.22 | -0.09 pts | +0.43 pts |
| 52-week | 4.17% | 4.36% | $957.84 | -0.18 pts | +0.66 pts |
Read it from left to right. The discount rate is how bills are quoted: it measures the discount against face value on a 360-day year, so it understates what you actually earn. The investment yield measures your interest against the price you pay, on a 365-day year, and it is the number to set against a savings account's APY or a CD rate. Price per $1,000 shows what $1,000 of face value would cost at that rate, and the last two columns show whether yields have risen or fallen over the past month and year.
When markets expect the Fed to hold rates steady, longer bills usually pay a little more than shorter ones; when they expect cuts, longer bills often pay less. The T-bill rates today page goes deeper on each term, and discount rate vs investment rate shows both formulas side by side.
How is a T-bill priced at a discount?
A bill's price is its face value minus a discount set by the auction rate and the number of days to maturity.
The quoted rate is applied to face value rather than to what you pay, and Treasury uses a 360-day year for the discount:
Price = Face value × (1 − discount rate × days to maturity ÷ 360)
You pay the price when the bill is issued and receive the face value at maturity. Nothing arrives in between: no coupons and no monthly interest. Because the interest is the gap between those two amounts, a higher rate means a lower price today.
Worked example: $10,000 in a 13-week bill
Suppose you place a noncompetitive bid for $10,000 of face value in the 13-week bill, which lasts 91 days. The table prices it at the latest 13-week discount rate, or at an illustrative 4.0% if the rate feed is unavailable.
| Step | Amount | How it is worked out |
|---|---|---|
| Face value | $10,000.00 | Paid back in full at maturity |
| Term | 13 weeks (91 days) | Bills are quoted on a 360-day year |
| Discount rate | 3.990% | the 13-week rate on Oct 30, 2026 |
| Purchase price | $9,899.14 | $10,000 × (1 − 3.990% × 91 ÷ 360) |
| Interest earned | $100.86 | Face value minus purchase price |
| Investment yield | 4.087% | Coupon-equivalent yield on a 365-day year |
Two rows matter most. The purchase price is the cash that leaves your bank account on the issue date, and the investment yield is the annualized return on that cash. If you rolled the same $10,000 of face value every 13 weeks for a year at an unchanged rate, you would earn about four times the interest shown.
The discount method is also why the investment yield is always a little higher than the quoted discount rate, and the gap widens as rates rise and terms lengthen. The guide to what a Treasury bill is covers issuance and pricing basics, and the calculator below runs the numbers for any term and rate.
How does a Treasury auction set the rate?
Treasury sells new bills at auction, and the auction decides the discount rate that every winning bidder receives.
Each auction runs in four steps: Treasury announces the amount and dates, takes bids until the deadline, accepts bids and issues the securities, usually within a week. Most bill terms are auctioned every week, and the 52-week bill every four weeks.
There are two kinds of bid:
- Noncompetitive: you agree to accept whatever rate the auction sets, and your order is filled in full up to $10 million per auction. It is the only kind of bid TreasuryDirect accepts, and the one most individuals use.
- Competitive: you name the lowest rate you will accept, and one bidder can win no more than 35% of the offering amount. Competitive bids go through a bank, broker or dealer.
Noncompetitive bids are filled first. Treasury then accepts competitive bids from the lowest rate upward until the offering is sold, and the highest rate it accepts becomes the rate for every winner, competitive and noncompetitive alike. That single-price design gives a saver bidding $1,000 the same terms as a primary dealer bidding billions. In TreasuryDirect, your results appear after 5 p.m. Eastern on auction day. The guide to how Treasury auctions work covers the auction calendar and walks through recent bill auction results.
Where can you buy and hold Treasuries?
You can hold Treasuries in four ways: directly at TreasuryDirect, through a brokerage, inside a fund, or as tokens in a blockchain wallet.
The table compares them on the five points that usually decide the choice.
| TreasuryDirect | Brokerage account | ETF or mutual fund | Tokenized T-bill fund | |
|---|---|---|---|---|
| Minimum | $100 for marketable securities; $25 for savings bonds | $100 at auction; secondary-market minimums vary by broker | One share, or less where fractional shares are offered | Often $100,000 to $5 million; a few SEC-registered funds accept small retail amounts |
| Costs | No fees to open an account, buy, hold or transfer | Many brokers charge no commission on Treasuries bought online; you pay the bid-ask spread when trading before maturity | An annual expense ratio (0.09% to 0.14% at two of the largest bill ETFs) plus a small bid-ask spread | A management fee, often a few tenths of a percent a year, plus network or stablecoin conversion costs |
| Liquidity | Hold to maturity, or wait 45 calendar days and transfer to a broker to sell; a 4-week bill cannot be sold early | Sell on any business day at the market price | ETFs trade all day on exchanges; mutual funds redeem once a day at net asset value | Set by each fund: often same-day or next-day redemption, and tokens may move only between approved wallets |
| Taxes | Federal tax in the year the bill matures; no state or local tax | Same as TreasuryDirect, plus gains or losses if you sell early | Dividends are taxed federally as ordinary income; most states exempt the part earned from Treasuries, some only if conditions are met | Depends on the fund's structure and home country; the state exemption may not pass through |
| Custody | In your name on the Treasury's own books | Held by the broker for you; if the firm fails, SIPC covers missing securities up to $500,000 per customer, including up to $250,000 in cash | You own fund shares; the fund's custodian holds the bills | Your wallet holds the tokens; the fund's custodian holds the assets |
TreasuryDirect
TreasuryDirect is the Treasury's own website for buying marketable securities and savings bonds, with no middleman and no fees. To open an account you need a Social Security number, a US address, a US bank account and an email address, and you must be at least 18. Online access now requires an ID.me account, the only way to sign in since October 28, 2026. You can place only noncompetitive bids, and you can schedule a bill to reinvest automatically when it matures.
The catch is liquidity. TreasuryDirect cannot sell anything for you: to sell before maturity, you hold the security for 45 calendar days and then transfer it to a bank or broker using a paper form signed in front of an official at a financial institution. A 4-week bill matures before the hold ends, so it cannot leave early at all. TreasuryDirect does not offer IRAs either. The TreasuryDirect account guide covers setup, sign-in and common problems.
A brokerage account
Most large brokers let you bid at Treasury auctions or buy existing bills, notes and bonds on the secondary market, in a taxable account or an IRA, and you can sell on any business day. Selling before maturity means accepting whatever price buyers offer, which may be above or below what you paid; selling Treasuries before maturity works through sales after rates rise and fall, including bid-ask costs. Holding Treasuries in a retirement account is covered in T-bills in an IRA; inside an IRA, the state-tax exemption no longer adds anything.
ETFs, mutual funds and money market funds
A T-bill ETF or Treasury mutual fund holds a rolling portfolio of bills, so you never handle a maturity, and one share is enough to start. The price of that convenience is a small annual expense ratio and a share price that moves slightly from day to day. Government money market funds are a close cousin: they must keep at least 99.5% of their assets in cash, government securities and fully collateralized repurchase agreements, and most aim for a stable $1.00 share price. Neither kind of fund is FDIC-insured. T-bill ETFs vs buying T-bills compares the two in dollars, and how money market funds work explains the rules those funds follow.
Buying your first bill
Whichever route you choose, a first purchase comes down to five decisions.
Pick a maturity date
Choose a term that ends before you will need the cash. Shorter terms keep your options open but expose you to rate changes sooner.
Choose where to hold it
Use the table above: TreasuryDirect for fee-free holding to maturity, a brokerage if you might sell early or want an IRA, or a fund if you would rather not manage maturities at all.
Place the order before the auction deadline
Submit a noncompetitive bid for the face value you want, or buy an existing bill or fund shares on the secondary market through a broker.
Fund it by the issue date
TreasuryDirect takes the purchase price from your linked bank account on the issue date, usually within a week of the auction. A broker needs settled cash in your account.
Decide what happens at maturity
Schedule a reinvestment, or let the face value return to your bank account or brokerage cash. Either way, note the maturity date, because bill interest counts as income in the year the bill matures.
The full walkthrough for each route is in how to buy Treasury bills.
What are tokenized Treasury funds?
They are funds that hold Treasury bills, or repurchase agreements backed by Treasuries, and record ownership of their shares as tokens on a blockchain.
The category has grown quickly. RWA.xyz, which tracks tokenized assets, counted 119 tokenized Treasury products holding about $14.2 billion as of November 1, 2026. Most are run by established asset managers or specialist issuers, buy short-term bills directly or through money market funds, and settle subscriptions and redemptions in dollars or stablecoins. Three features set them apart from the ETFs above:
- Who can buy. Many are private funds open only to accredited investors (for individuals, generally a net worth above $1 million excluding a primary home, or income above $200,000, or $300,000 with a spouse) or to qualified purchasers (generally $5 million or more in investments). Others are sold only to people outside the United States. A small number are SEC-registered government money market funds that keep their share register on a blockchain and accept ordinary US investors after identity checks.
- How the token relates to the asset. A January 2026 SEC staff statement separates securities tokenized by or for their issuer from tokens created by third parties, which may hold the real security in custody or only provide synthetic exposure to it. A synthetic token gives you no rights against the issuer of the security it tracks, and the staff stressed that recording ownership on a blockchain does not change how securities laws apply.
- How you hold it. Tokens sit in a crypto wallet, often one the issuer has approved in advance, and can move around the clock between eligible wallets, while the fund itself still prices and redeems shares on its own schedule.
Do not confuse these funds with stablecoins, even though both often hold short-term Treasuries. The GENIUS Act bars issuers of payment stablecoins from paying holders any interest or yield. Key dates for the law: Signed July 18, 2025 (Public Law 119-27); takes effect January 18, 2027. A tokenized fund share is a security that passes the Treasury income through to you, along with the disclosures and risks of a fund. The risks specific to the format, from smart-contract bugs to frozen wallets, are covered in the risks section below.
For background, see our posts on on-chain US T-bills and how tokenized bonds differ from traditional bonds, the guide to tokenized Treasuries for non-US investors, the comparison of stablecoin yield vs bank interest and the live list of top stablecoins.
How is Treasury interest taxed?
Treasury interest is taxable on your federal return but exempt from state and local income taxes under federal law.
The state exemption comes from Title 31, section 3124 of the US Code, and it covers bills, notes, bonds, TIPS, floating rate notes, STRIPS and savings bonds alike. What differs is when the federal tax is due:
- Bills: the discount counts as interest in the year the bill matures or is sold, and it is reported on Form 1099-INT. A 26-week bill bought in November 2026 that matures in May 2027 belongs on your 2027 return.
- Notes and bonds: coupons are taxed in the year you receive them.
- TIPS and STRIPS: tax is due each year on income you have not been paid yet, the inflation increase to TIPS principal and the interest building up inside STRIPS.
- Savings bonds: you can defer federal tax until you cash the bond, and the interest may be excluded if you spend it on qualified higher-education costs.
- Funds and tokens: ETF and mutual fund payouts are dividends. Most states exempt the share that came from Treasury interest, but some set conditions; California, for example, requires at least half of the fund's assets to be exempt obligations such as Treasuries. Tokenized funds depend on their structure and home country, and the exemption may not carry through at all.
Worked example: A 26-week bill vs a 6-month CD, after tax
Assume you pay 24% federal tax and 6% state income tax, take the standard deduction, and have about $24,500 to set aside for six months. On October 30, 2026, the 26-week bill was quoted at a 4.11% discount rate. A hypothetical 6-month bank CD pays 4.40% a year in simple interest.
| 26-week T-bill | 6-month CD at 4.40% | |
|---|---|---|
| Amount invested | $24,480.54 (price of $25,000 face, 182 days) | $24,480.54 |
| Interest earned | $519.46 | $537.10 |
| Federal tax at 24% | $124.67 | $128.90 |
| State tax at 6% | $0 | $32.23 |
| Interest after tax | $394.79 | $375.97 |
| After-tax annual yield | 3.23% | 3.08% |
The CD's higher headline rate loses after tax: the bill keeps $18.82 more. To match the bill in this situation, the CD would need to pay about 4.62%. In a state with no income tax, the result flips and the CD comes out ahead, because the bill's exemption is worth nothing there.
Tax rules change, and the details depend on your state and filing situation, so a tax professional can confirm how they apply to you. Are T-bills taxable? covers reporting, the 1099-INT and the state exemption in depth.
How do T-bills compare with savings accounts, CDs and money market funds?
Bills trade some flexibility for a fixed rate and a state-tax exemption, while savings accounts and money market funds let you withdraw on any business day.
| T-bills | High-yield savings account | Bank CD | Government money market fund | |
|---|---|---|---|---|
| Protection | Full faith and credit of the US government | FDIC insurance up to $250,000 per depositor, per insured bank, per ownership category | Same FDIC coverage as savings | No FDIC insurance; the fund holds government securities and repurchase agreements |
| Rate | Fixed until maturity, set at auction | Variable; the bank can change it at any time | Fixed for the term | Variable; moves daily with short-term rates |
| Getting cash out | At maturity, or sell through a broker at the market price | Any time | At maturity; early withdrawal usually costs a penalty | Any business day |
| State and local income tax | Exempt | Taxed | Taxed | Partly exempt, depending on the fund's holdings and your state |
| Minimum | $100 | Often none | Set by the bank | Set by the fund, often low |
The FDIC's latest monthly national averages show why the comparison matters: 0.38% on savings accounts, 0.63% on money market deposit accounts and 1.76% on 12-month CDs. Averages include many accounts that pay very little, so individual offers vary widely. Set any offer you are considering against the investment yield in the live table above, after tax.
Money market funds are the closest substitute for bills, partly because they own so many of them: the GAO found that money funds held about 36% of all bills outstanding in March 2025. Their yields track bill rates minus the fund's fee. The difference is that a money fund's yield floats every day, while a bill locks its rate until maturity.
Each pairing has its own guide: T-bills vs CDs, T-bills vs high-yield savings and T-bills vs money market funds. For the bank side, see how high-yield savings accounts work, what a CD is and brokered CDs. For choosing a home for cash more broadly, start with the safe investments guide and where to keep an emergency fund.
What makes Treasury rates rise and fall?
Short-term bill rates follow the Federal Reserve's policy rate, while longer yields also reflect inflation expectations and how much investors want to be paid for tying money up.
The Fed. The Federal Open Market Committee sets a target range for the federal funds rate, currently 3.75% to 4.00%. Bills are close substitutes for overnight money, so a 4-week bill trades near that range, and longer bills shift ahead of Fed meetings as markets price in the next decision. In October 2026 the Committee held the range steady after raising it in September. How Fed rate decisions affect T-bill rates shows how the target and bill yields have moved together.
Inflation. Investors want a yield that at least keeps pace with prices. Consumer prices rose 3.7% in the 12 months to September 2026, according to the Bureau of Labor Statistics, and higher inflation tends to push up both the Fed's target and longer yields. The yield curve section below shows the gap between regular and inflation-protected yields, which is a rough market estimate of future inflation.
Supply, demand and the term premium. Longer yields also rise when investors want extra pay for locking up money for years, when the Treasury borrows more, or when big buyers step back. These forces can move long yields sharply in a short time: the 10-year yield fell from 5.31% on October 5 to 4.94% on October 30, 2026. What moves Treasury yields explains each driver, and why bond prices fall when rates rise shows what those moves do to prices.
How do you read the Treasury yield curve?
The yield curve plots Treasury yields from one month to 30 years, so you can see at a glance how much extra each step out in maturity pays.
- Oct 30, 2026
- Oct 30, 2025
| Maturity | Yield | A month earlier | A year earlier |
|---|---|---|---|
| 1 month | 4.06% | 4.02% | 4.05% |
| 6 weeks | 4.09% | 4.13% | 4.02% |
| 2 months | 4.16% | 4.16% | 4.04% |
| 3 months | 4.16% | 4.20% | 3.92% |
| 4 months | 4.18% | 4.29% | 3.87% |
| 6 months | 4.25% | 4.33% | 3.79% |
| 1 year | 4.36% | 4.54% | 3.70% |
| 2 years | 4.56% | 4.88% | 3.61% |
| 3 years | 4.65% | 5.00% | 3.61% |
| 5 years | 4.71% | 5.09% | 3.72% |
| 7 years | 4.80% | 5.19% | 3.90% |
| 10 years | 4.94% | 5.29% | 4.11% |
| 20 years | 5.34% | 5.68% | 4.64% |
| 30 years | 5.31% | 5.64% | 4.65% |
| 10-year minus 2-year | +0.38 pts | +0.41 pts | +0.50 pts |
| 10-year minus 3-month | +0.78 pts | +1.09 pts | +0.19 pts |
| Maturity | Real yield (TIPS) | Nominal yield | Implied inflation (nominal minus real) |
|---|---|---|---|
| 5 years | 2.25% | 4.71% | 2.46% |
| 7 years | 2.42% | 4.80% | 2.38% |
| 10 years | 2.60% | 4.94% | 2.34% |
| 20 years | 2.92% | 5.34% | 2.42% |
| 30 years | 3.08% | 5.31% | 2.23% |
Start with the shape. A curve that slopes upward means longer maturities pay more, the usual pattern when investors want extra yield for tying up money. A flat curve means you give up little by staying short, which is when bills are hardest to beat. An inverted curve, with short yields above long ones, signals that markets expect rates to fall; inversions have often come before recessions, though the lag has varied widely. The inverted yield curve explained covers that record.
Then check the spreads in the table. The 10-year minus 2-year and 10-year minus 3-month figures are the standard measures of slope, and a negative number means that stretch of the curve is inverted. The dashed line for a year ago shows how far the whole curve has shifted, which matters if you are comparing a bill bought last year with one you could buy now.
Finally, the real yield table shows yields on TIPS, which are paid on top of inflation. Subtracting the real yield from the regular yield of the same maturity gives the implied inflation rate. If inflation averages more than that figure, TIPS will have done better than regular Treasuries of the same maturity; if it averages less, regular Treasuries will have. TIPS explained works through this breakeven, and the Treasury yield curve data page covers each of these figures in more detail.
What are the risks of holding Treasuries?
Treasuries carry little credit risk, but they still expose you to rate changes, inflation, reinvestment, limited liquidity before maturity and, for tokenized funds, platform risk.
Interest-rate risk
When market yields rise, the price of an existing Treasury falls, and the longer its maturity the bigger the drop. Using Treasury's par yields from October 30, 2026, a 1-percentage-point jump in yields would cut the market value of a newly issued security by roughly:
- 13-week bill: 0.25%
- 2-year note: 1.87%
- 10-year note: 7.46%
- 30-year bond: 13.39%
If you hold to maturity you still receive the full face value, so the loss becomes real only if you sell. That is why bills and short notes suit money with a fixed spending date. Funds that hold longer Treasuries never mature, so their prices stay exposed. The math behind these figures is in why bond prices fall when rates rise.
Inflation risk
A bill's yield is fixed in dollars, not in purchasing power. In late October 2026 the 13-week bill's investment yield was 4.08%, while consumer prices were up 3.7% over the previous year. After 24% federal tax the bill's yield drops to about 3.10%, roughly 0.6 points below inflation, so the real after-tax return was slightly negative. TIPS and I bonds address this risk directly; real returns and inflation shows how to run the comparison.
Reinvestment risk
Worked example: Rolling $100,000 in 13-week bills
The 13-week bill's investment yield was 5.38% on July 1, 2024 and 3.65% on December 31, 2025. At those rates, a year of interest on $100,000 works out to about $5,380 and $3,650: a drop of $1,730, almost a third, with no change in the amount invested. By October 30, 2026 the yield was back at 4.08%.
Short maturities let you capture rising rates quickly, but they also hand you whatever rate prevails each time a bill matures. Locking in a longer note, or building a T-bill ladder, spreads that risk across several dates.
Liquidity before maturity
Where you hold a Treasury decides how quickly you can turn it into cash. TreasuryDirect's holding period and transfer process, described above, rule out a quick sale. Savings bonds are stricter still, and the rule is the same for EE and I bonds: Not cashable for 12 months; cashing before 5 years forfeits the last 3 months of interest. At a broker you can sell on any business day, but older issues and small lots can trade at a wider bid-ask spread, and a sale after rates have risen locks in a loss.
Credit-rating and debt-ceiling headlines
Moody's downgraded the United States to Aa1 from Aaa in May 2025, and S&P Global affirmed its AA+ rating, one step below the top, in June 2026. A downgrade does not change what a Treasury pays at maturity, but the debt limit can cause real, if short-lived, problems. The limit stands at $41.1 trillion, and projections cited by the Congressional Research Service have federal debt reaching it in early to mid-2027.
The GAO counted 13 debt-limit impasses between 2011 and 2025. As each projected default date approached, investors demanded higher yields on new securities maturing near it, many avoided holding them, and those securities lost value against similar ones maturing just before. Every impasse so far ended with Congress raising or suspending the limit. The guide to whether Treasuries are risk-free puts these episodes in context, and types of investment risk defines each risk on this list.
Platform risk in tokenized funds and other wrappers
Tokenized funds add risks that a TreasuryDirect account does not have: bugs in the smart contract that issues the tokens, errors in the price feeds that value them, lost wallet keys, issuer controls that can freeze tokens, redemption limits during stress, and dependence on a stablecoin to move cash in and out. If the issuer, transfer agent or custodian fails, what you recover depends on the fund's legal structure and where it is based, and tokens in your own wallet are not covered by SIPC. ETFs and money funds carry milder wrapper risks: an ETF can trade slightly above or below the value of its holdings, and a money fund is not FDIC-insured, so its value can fall.
What happens at maturity, and how do ladders work?
When a bill matures, its face value goes to your bank account or brokerage cash that day, unless you scheduled a rollover into a new bill.
TreasuryDirect now pays maturing securities only to your primary bank account; its zero-interest Certificate of Indebtedness stopped being a payment option on August 24, 2026. Rolling over is how most people use bills for longer than one term: TreasuryDirect lets you schedule reinvestments when you buy or later, each new bill is bought at that week's auction rate, and brokers offer automatic rollovers that work the same way. What happens when a T-bill matures covers the timing, the reinvestment options and what changes for taxes.
A ladder spreads money across several maturities so that some cash comes back at regular intervals. Buying $5,000 of face value in each of the 4-, 8-, 13- and 26-week bills, for instance, returns cash at four points over the next six months, and each rung can be rolled into a new 26-week bill as it matures. That smooths out reinvestment risk and gives you regular access to cash without selling anything. The T-bill ladder guide sets up ladders step by step, and the compound interest calculator shows what reinvesting the interest adds over several years.