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Treasury Bills (T-Bills): What They Are and How To Invest

A Treasury bill (T-bill) is a short-term U.S. government debt obligation backed by the U.S. Department of the Treasury. Terms range from four to 52 weeks. T-bills are issued at a discount from the par value, also known as the face value. Treasury bills are usually sold in denominations of $100. However, some can reach a maximum denomination of $5 million in noncompetitive bids. The Treasury sells T-bills during auctions using a competitive and noncompetitive bidding process.Key TakeawaysA Treasury bill (T-bill) is a short-term debt obligation backed by the U.S. Department of the Treasury with a one-year maturity or less.Treasury bills are usually sold in denominations of $100 and can reach a maximum denomination of $10 million.T-bill rates depend on interest rate expectations. How To Buy Treasury Bills The U.S. Department of the Treasury issues T-bills toraise cash tofund the federalgovernment’s spendingwhen there isa budget deficit. T-bills are generally held either until the maturity…