The U.S. Treasury issues several types of debt instruments to finance government operations and manage the national debt. The main types of items include:
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Treasury Bills (T-Bills): Short-term securities with maturities ranging from a few days to one year. They are sold at a discount to face value and do not pay interest prior to maturity; instead, the investor receives the face value at maturity.
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Treasury Notes (T-Notes): Medium-term securities with maturities ranging from two to ten years. They pay a fixed interest rate (coupon) every six months until maturity, at which point the face value is returned.
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Treasury Bonds (T-Bonds): Long-term securities with maturities of 20 or 30 years. Like T-Notes, they pay a fixed interest rate every six months.
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Treasury Inflation-Protected Securities (TIPS): These securities are designed to protect against inflation. The principal amount is adjusted based on changes in the Consumer Price Index (CPI), and they pay interest every six months based on the adjusted principal.
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Savings Bonds: These are non-marketable securities issued to the public, primarily for individual investors. They include Series EE and Series I bonds, which provide a low-risk way to save.
All of these instruments are considered safe investments as they are backed by the "full faith and credit" of the U.S. government.