What is a Treasury Bill or T-Bill? How do they work?

Quixer Explainer video. Not specific financial advice. A T-bill is a short-term government debt security issued by the U.S. Department of the Treasury. Unlike other bonds, T-bills don’t pay periodic interest. Instead, they are sold at a discount to their face value, and when they mature, you receive the full face value, with the difference representing the interest earned.

Imagine you’re considering a T-bill as part of your investment strategy. First, you decide how much you want to invest and choose a maturity period that fits your financial goals. T-bills come in various durations, such as 4 weeks, 13 weeks, 26 weeks, and 52 weeks.