How Do You Invest in Bonds?


Quick Answer

One way to invest in U.S. Treasury bonds, notes, bills or saving bonds is to buy them directly from TreasuryDirect.gov. Create an account, log in and purchase bonds to redeem them when the securities mature, explains the U.S. Department of the Treasury.

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Full Answer

Bonds are issued by the U.S. Treasury Department, municipalities, state governments, local governments and corporations, according to the Financial Industry Regulatory Authority. Treasury bills mature with maximum interest after four-, 13-, 26- or 52-week terms. Treasury notes offer investments of two, three, five, seven and 10 years. Treasury bonds mature after 30 years.

A bond purchased through TreasuryDirect does not have a paper format. Transactions are done electronically, and the investment is returned through a bank account. TreasuryDirect does not have any maintenance fees, according to its official website. To open an individual TreasuryDirect account, you need a taxpayer identification number or Social Security number; an address of record within the United States; a checking or savings account with the routing number; an email address; and a web browser that supports 128-bit encryption. Your web browser must have encryption for secure transactions over the web. A phone number is also required. To finish setting up the account, create a password and answer three security questions.

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