Are Treasury Bills a Good Investment? Treasury Bills, or T-bills, are short-term debt instruments issued by the U.S. government to finance its operations. They are considered a safe Investment because their principal and interest is backed by the full faith and credit of the U.S. government. Investing in Treasury Bills is an attractive way for investors to earn a steady stream of income without taking on too much risk in their portfolio.
In today's uncertain economic environment, many investors are looking for safe places to park their money, and T-bills provide a reliable option. T-bills are also attractive because they offer a relatively high rate of return compared to other government debt instruments. The current rate for three-month T-bills is around 0.4%, which is significantly higher than the interest rate on savings accounts and other short-term Investment.
Higher rates are good for 2023 bond returns for two reasons. One, even if rates stay where they are, you'll get a nice positive return from the interest payments. Two, should rates rise, the market value of your bond will rise, resulting in a higher return overall.