Treasury Bills, Notes, Bonds, and TIPS

The United States government issues four types of debt that it backs with its full faith and credit taxing powers. They are called treasury bills, treasury notes, treasury bonds, and treasury inflation protection securities. These terms are often used interchangeably, but have differences in terms of interest payment and duration. Below, I outline the difference between the types of debt instruments offered by the United States:

What Are Treasury Bills?

Treasury Bills are the shortest form of debt issued by the United States government. In terms of duration, they are frequently sold in maturity increments of 13 weeks, 26 weeks, and 52 weeks, though the only technical requirement is that a T-Bill duration must be one year or shorter. Treasury bills are sold in increments ranging from $1,000 to $5,000,000. You do not collect interest payments, but instead, treasury bills sell at a discount below par and this represents your … Read the rest of this article!

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