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Choose a U.S. Treasury security by matching its maturity to when you expect to need the money, then decide whether you prefer interest payments along the way or a payment at maturity. Also consider whether you might sell early: Treasury securities can be sold before maturity, but the sale price can be higher or lower than face value.
What is the difference between Treasury bills, notes, and bonds?
The main differences are how long the money is committed and when interest is paid. Treasury’s current standard terms, accessed in 2026, are:
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| Security | Standard term | Cash flow | Useful question |
|---|---|---|---|
| Treasury bill | 4, 6, 8, 13, 17, 26, or 52 weeks | Sold at a discount or at par; face value is paid at maturity. The difference between the purchase price and face value is the bill’s interest. | Will you need the money within about a year? |
| Treasury note | 2, 3, 5, 7, or 10 years | Fixed interest rate set at auction, paid every six months. | When in the next decade should the money be available, and would semiannual income be useful? |
| Treasury bond | 20 or 30 years | Fixed interest rate set at auction, paid every six months. | Is this long-term money, and can you accept price changes if you sell before maturity? |
These are U.S. Treasury marketable securities. A Treasury bond is not the same as a U.S. savings bond. See TreasuryDirect’s Treasury bills, Treasury notes, and Treasury bonds pages for product terms.
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How do you choose a Treasury maturity?
Start with the date you may need the money
Write down when the money is likely to be spent or needed. For a near-term need, a bill’s shorter term may mean less time before principal is due. For a known future expense, compare note or bond maturities close to that date. This is a way to organize a decision, not a guarantee against loss: if you sell before maturity, the market price can differ from what you paid.
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If the date is uncertain, avoid treating the longest maturity you can buy as automatically best. A longer-term security may require selling at a market price if plans change.
Choose the payment pattern that fits
Bills pay their face value at maturity; the difference between the discounted purchase price and that payment is the bill’s interest. Notes and bonds pay interest every six months, with the rate set at auction. A note’s or bond’s coupon rate is not the same as its yield or total return: the price paid and any sale price also matter. Treasury explains the distinction in Understanding Pricing and Interest Rates.
What happens if you sell before maturity?
Treasury marketable securities may be sold before maturity, but that does not lock in a particular price. For notes and bonds, the market price reflects the relationship between the security’s fixed interest rate and current yields. When current yield is above the coupon rate, the price is below face value; when current yield is below the coupon rate, the price is above face value. The price may also be affected by the time remaining until maturity.
TreasuryDirect puts the choice plainly: “You can hold a note until it matures or sell it before it matures.” The ability to sell early is useful, but an early sale can produce proceeds above or below the amount invested. Read TreasuryDirect’s overview of Treasury marketable securities for more on marketability.
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How do taxes affect the choice?
Treasury says interest and bill discount earnings are subject to federal income tax and exempt from state and local income taxes. Your own reporting depends on the security and tax circumstances; consult current IRS instructions or a tax professional for personal guidance. TreasuryDirect’s Tax Forms and Tax Withholding information includes details relevant to TIPS.
When should you compare TIPS?
Treasury Inflation-Protected Securities (TIPS) are a related option if inflation-linked principal is important. Their principal adjusts with inflation and deflation, and they pay interest every six months. Because interest is calculated on the adjusted principal, the payment amount can vary. TIPS therefore differ from conventional notes and bonds, whose principal is not inflation-adjusted. Treasury describes the mechanics in Understanding Pricing and Interest Rates.
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Where can you buy Treasury securities?
Treasury securities are sold at public auctions and are available through banks and brokerages. Check Treasury’s current auction calendar and recent auction results before choosing a purchase date or comparing rates: yields and auction details change over time. TreasuryDirect describes access routes in How Treasury Marketable Securities Work.
Treasury securities are described as backed by the full faith and credit of the U.S. government. That refers to the issuer’s backing; it does not mean a security’s market price stays fixed if you sell before maturity. Investor.gov provides a general explanation in its Bonds FAQs.
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