How to Buy Bonds

If you're thinking of investing your money, there are many different investment vehicles for you to choose from. They vary from very low risk to high risk, low-return to high-return, short term to long term. Which type of investment is right for you depends on your financial circumstances and your personal preferences when it comes to risk.

You may have heard of bonds as a form of investment. When people talk about bonds, they are either referring to corporate bonds or US savings bonds. Corporate bonds are not a good investment option for first-timers. Most corporate bonds are sold behind closed doors by professional investors and traders. There is little room in the market for amateurs.

US savings bonds are a whole other matter. These types of bonds are sold by the US Treasuries Department. It's a way for the government to raise money to pay for running the country. In return for using your money, the government offers to pay you interest. You may even get some tax benefits for buying savings bonds.

US savings bonds are a very low-risk form of investment. It's very unlikely that the American government will go bankrupt in your lifetime. Bonds are a long-term investment. Many people hold on to savings bonds for decades. Finally, because of inflation, savings bonds do not offer a very large return on your investment. If you're looking to get rich off your savings, consider another, more high-risk investment vehicle.

Buying US savings bonds is very easy. You can buy them at your local bank or go online at www.TreasuryDirect.gov . You'll have to create an account first. The whole process takes less than 15 minutes.