TL;DR: The U.S. Treasury issues three main types of marketable
debt that differ by maturity and how they pay you back. T-Bills
mature in a year or less and pay no coupon — you buy them at a discount and
get face value at maturity. T-Notes run 2 to 10 years and
T-Bonds run 20 or 30 years, both paying a fixed coupon every
six months. All three are direct obligations of the U.S. government, sold in
$100 increments, and together make up most of the $31.5 trillion federal debt.
The three flavors of marketable Treasuries
A “marketable” Treasury is one you can buy and sell in the secondary market
after issuance (savings bonds, by contrast, are non-marketable and stay with
the original owner). The Treasury runs a fixed auction calendar so the market
knows exactly when supply is hitting, and each security type sits at a
different point on the yield curve.
| Security | Maturities | How it pays | Auction frequency |
|---|---|---|---|
| T-Bills | 4, 6, 8, 13, 17, 26, 52 weeks | Sold at a discount or at par; pays face value at maturity, no coupon | Weekly (52-week: every 4 weeks) |
| T-Notes | 2, 3, 5, 7, 10 years | Fixed semiannual coupon; face value at maturity | Monthly for 2/3/5/7-year; Feb / May / Aug / Nov for 10-year |
| T-Bonds | 20, 30 years | Fixed semiannual coupon; face value at maturity | 4 original issues per year; 8 reopenings |
TreasuryDirect — Treasury Bills,
Treasury Notes,
and
Treasury Bonds.
Minimum purchase is $100 across all three.
T-Bills: the cash-like end of the curve
Treasury bills are the short end of the curve. The Treasury sells them at
seven standard maturities — 4, 6, 8, 13, 17, 26, and 52 weeks — with weekly
auctions for everything up to 26 weeks and a 52-week auction every four weeks,
per
TreasuryDirect.
Bills don’t carry a coupon. You buy at a discount to face value and the
Treasury pays you the full face amount at maturity. The difference is your
interest.
Worked example: you buy a 13-week (91-day) bill at a price of $98.75 per
$100 of face value. At maturity 91 days later, Treasury pays you $100. The
quoted bank-discount yield is computed on the face amount and a 360-day year:
Bank-discount yield = (Discount ÷ Face) × (360 ÷ Days)
= ($1.25 ÷ $100) × (360 ÷ 91) = 4.95%
The investment yield, which compares apples-to-apples with a coupon bond,
uses the purchase price and a 365-day year:
Investment yield = (Discount ÷ Price) × (365 ÷ Days)
= ($1.25 ÷ $98.75) × (365 ÷ 91) = 5.08%
Both definitions come from the Treasury’s
Understanding Pricing and Interest Rates
page. The takeaway: a quoted “bill yield” on a newswire is usually the
bank-discount number, which understates the true holding-period return by a
small but meaningful amount.
Understanding Pricing and Interest Rates.
T-Notes: the workhorse of the curve
Treasury notes are issued at 2, 3, 5, 7, and 10 years. They pay a fixed
coupon every six months and return your principal at maturity. The Treasury
auctions 2/3/5/7-year notes monthly and 10-year notes four times a year
(February, May, August, November), with reopenings in between, per
TreasuryDirect.
Notes dominate the marketable stock — $15.94 trillion outstanding as of
May 2026, more than half of all marketable Treasury debt (see chart below).
The 10-year note in particular is the global benchmark risk-free rate; it
anchors mortgage pricing, corporate spread quoting, and the equity risk
premium calculation. When you hear “the 10-year is at 4.41%,” it’s this
security.
One quoting wrinkle: secondary-market Treasury notes and bonds are priced
in 32nds of a point. A quote of “99-16” means 99 + 16/32 = $99.50 per $100 of
face value. Half a 32nd is written as a “+” (so “99-16+” is 99 + 16.5/32).
This is just convention from the pre-decimal era and is largely cosmetic, but
worth knowing if you read a dealer screen.
T-Bonds: the long end
Treasury bonds are the long end, with current maturities of 20 and 30
years. They pay semiannual coupons just like notes. The Treasury runs four
original-issue auctions per year and eight reopenings (per
TreasuryDirect);
that’s a relatively slim issuance pipe compared with the weekly bill churn,
which is one reason the long bond can trade more thinly than short coupons.
Two things matter most about T-bonds for an investor:
- Duration risk dwarfs everything else. A 30-year bond’s
price moves roughly six to seven times more for a given yield change than a
five-year note. That’s not a bug — it’s the point of buying duration — but
“safe Treasury” does not mean “stable price.” The 2022-2023 long-bond
drawdown is the recent reminder. - Demand is institutional. Pensions, insurers, and
liability-driven investors (LDI) need long, locked-in cash flows to match
long liabilities. That’s why the 30-year often clears at a yield only a few
basis points above (or even below) the 20-year, despite the longer
maturity — see the live curve, where the 30-year sits at 4.86% versus the
20-year at 4.87%.
Snapshot: the live Treasury curve
Here is the Treasury constant-maturity yield curve from the most recent
Federal Reserve H.15 release. The 1-month bill yields 3.66% while the
10-year note yields 4.41% and the 30-year bond yields 4.86% — a positive
slope from front-end to long-end, with a slight inversion in the very long
end (30-year < 20-year).
| Maturity | Yield (%) | Security type |
|---|---|---|
| 1M | 3.66 | T-Bill |
| 3M | 3.85 | T-Bill |
| 6M | 3.95 | T-Bill |
| 1Y | 3.99 | T-Bill |
| 2Y | 4.11 | T-Note |
| 3Y | 4.15 | T-Note |
| 5Y | 4.17 | T-Note |
| 7Y | 4.28 | T-Note |
| 10Y | 4.41 | T-Note |
| 20Y | 4.87 | T-Bond |
| 30Y | 4.86 | T-Bond |
nominal Treasury constant-maturity series, as of June 24, 2026.
How much of each is outstanding?
The marketable Treasury stock is dominated by notes, with bills second and
bonds third. As of May 2026, of roughly $31.5 trillion in total public debt,
about $28.1 trillion is marketable and breaks down as follows:
That mix is a policy choice. The Treasury’s Office of Debt Management and
the Treasury Borrowing Advisory Committee (TBAC) target a weighted-average
maturity of the debt stock that balances rollover risk (lots of bills = lots
of refinancing in any quarter) against funding cost (bonds cost more than
bills when the curve is upward-sloping). When the deficit is large, the
Treasury typically leans on bills first because they are easier to absorb,
then term out as the curve allows.
Common mistakes
- Treating a bill “yield” the same as a note “coupon.” The
quoted bank-discount yield on a T-bill is not directly comparable to a
coupon-bond yield. Use the investment yield (or “coupon equivalent”) when
comparing. - Forgetting accrued interest on coupon Treasuries. When
you buy a note or bond between coupon dates, you pay the seller the accrued
interest from the last coupon date. That cash comes back to you at the next
coupon — but it’s a real out-of-pocket on settlement day. - Assuming “T-Bond” means safe price. Credit risk is
near-zero; price risk is not. A 30-year bond can lose 20%+ of its market
value if long yields rise 200 basis points, which happened in 2022. - Confusing T-Bonds with I-Bonds and EE-Bonds. T-Bonds are
marketable, trade in size, and quote in 32nds. I-Bonds and Series EE bonds
are non-marketable savings bonds with annual purchase caps, sold only via
TreasuryDirect. Different instruments, different audiences. - Assuming the 30-year always yields more than the 10-year.
Usually true, but not always — the long end can invert when the market is
pricing slower long-run growth or strong pension demand for duration.
Today’s H.15 reading shows the 30-year (4.86%) slightly below the 20-year
(4.87%).
Related concepts and what to learn next
- Yield curve shapes and inversion — how to read the slope across the bills/notes/bonds you just learned.
- Bond duration and convexity — the math behind why long bonds move so much more than bills.
- Treasury auctions decoded — bid-to-cover, indirect bidders, and tails.
- TIPS and Floating Rate Notes — the inflation-linked and short-rate-linked cousins of nominal Treasuries.
Sources
- U.S. Treasury / TreasuryDirect, Treasury Bills, Treasury Notes, Treasury Bonds.
- U.S. Treasury, Understanding Pricing and Interest Rates (discount-yield and investment-yield formulas).
- Federal Reserve, H.15 Selected Interest Rates (Treasury constant-maturity yields, as of June 24, 2026).
- U.S. Treasury, Monthly Statement of the Public Debt.
- Peter G. Peterson Foundation, What Types of Securities Does the Treasury Issue? (May 2026 composition snapshot).
- U.S. Treasury, Daily Treasury Par Yield Curve Rates.
Disclosure: This article was produced with AI assistance and reviewed before publication. It is for informational purposes only and is not investment advice.