T-Bill Purchase Question

[RetiredAndLovingIt]

I went to Treasury Direct last Monday 8/22 and placed my first ever order for a 4 week T-Bill as a test.
It seemed fairly simple, and I got an acknowledgement from them the same day

Dear Retired

A purchase has been scheduled in your TreasuryDirect account on 8/22/2022. For more details, go to the History tab and click Security History. If you have a question about this activity, please call (844) 284-2676.

Thank you for using TreasuryDirect.

I assumed the auction was happening last week but still no payment has been withdrawn from my bank account. I finally checked my Treasury Direct today and it looks like it has an issue date of 8/30. I thought they did auctions weekly, how did I manage to miss last weeks auction or is this normal?

 

[JoeWras]

It worked as promised. The auction was on Thursday.

Look here:
https://home.treasury.gov/system/files/221/Tentative-Auction-Schedule.pdf

And an excerpt specific to your situation. Click to zoom in.

 

[lucky penny]

What time did you place your order? According to TD's website:

"The competitive closing time for bills is normally 11:30 a.m. Eastern Time on auction day and the competitive closing time for notes, bonds, FRNs, and TIPS is normally 1:00 p.m. Eastern Time on auction day."

The $$ will be withdrawn from your account on the settlement date (issue date), 8/30.

Here's the calendar from TD's website:
https://home.treasury.gov/system/files/221/Tentative-Auction-Schedule.pdf

 

[RetiredAndLovingIt]

It worked as promised. The auction was on Thursday.

Look here:
https://home.treasury.gov/system/files/221/Tentative-Auction-Schedule.pdf

And an excerpt specific to your situation. Click to zoom in.

You're a star, thanks.

 

[Dash man]

And if you do miss an auction, there’s another one coming soon. [emoji3]

 

[JoeWras]

Some people play with fire and try to buy 13 and 26 week Bills on Monday morning, through their broker. (Auction closes on Monday.) Glitches in the system happen... No reason to wait to the last second on a non-competitive bid.

Note also, the broker may have a different closing time than the treasury department. I think Vanguard shuts it at 9:30AM.

 

[RetiredAndLovingIt]

I did it in plenty of time but somehow got all my dates wrong so it will settle on Tuesday. i printed the schedule page so I should not have a problem next time.

 

[Dash man]

I did it in plenty of time but somehow got all my dates wrong so it will settle on Tuesday. i printed the schedule page so I should not have a problem next time.

You can also sign up on TD for email announcements of upcoming auctions and the results after the auction.

 

[Midpack]

That’s funny. I bought a $1000 4 week as a test in July that was redeemed 5 days ago, also as a test. Just bought a larger 6 month and 52 week bills too.

 

[Dash man]

That’s funny. I bought a $1000 4 week as a test in July that was redeemed 5 days ago, also as a test. Just bought a larger 6 month and 52 week bills too.

We’ve put orders in for the 26 week and 13 week auctions tomorrow. Hoping by their maturity we can start making some longer purchases. We did get a 2 year note last week for 3.307%.

 

[RetiredAndLovingIt]

We’ve put orders in for the 26 week and 13 week auctions tomorrow. Hoping by their maturity we can start making some longer purchases. We did get a 2 year note last week for 3.307%.

Is there a calculator for these to figure out what that 2 yr note will pay and how often do they pay out?
Brand new to this so I don't understand the process yet but I'm getting ready to buy one, and that rate seems really high.

 

[Dash man]

Is there a calculator for these to figure out what that 2 yr note will pay and how often do they pay out?
Brand new to this so I don't understand the process yet but I'm getting ready to buy one, and that rate seems really high.

A two year note will pay interest on the 6th, 12th and 18th month and mature at 2 years paying the final interest and face value of the note. If you buy at auction, just compute the coupon rate from the note times the face value and divide by two. That will give you the interest. At maturity you’ll get the interest plus the face value of the note, which will include any discount you got at purchase.

 

[jldavid47]

Some people play with fire and try to buy 13 and 26 week Bills on Monday morning, through their broker. (Auction closes on Monday.) Glitches in the system happen... No reason to wait to the last second on a non-competitive bid.

Note also, the broker may have a different closing time than the treasury department. I think Vanguard shuts it at 9:30AM.

Schwab also cuts off treasury auction orders at 9:30AM. I've been buying T-Bills both at auction and in the open market through Schwab. Their rules are clear.


I also have a Treasury Direct account but I only use it to purchase I-Bonds. I have immediate liquidity at Schwab should I decide to get out of any of my T-Bills early. With TD I'd have to wait for them to transfer the funds.

 

[JoeWras]

Is there a calculator for these to figure out what that 2 yr note will pay and how often do they pay out?
Brand new to this so I don't understand the process yet but I'm getting ready to buy one, and that rate seems really high.

On Vanguard, there are tools that come in handy once you buy your Note, Bill or corporate or muni Bonds. If you have the "New UI", I have a screenshot attached (bottom of post) of how to access it. It gives a very nice visual grid of upcoming income events. For me, the visual really helps me organize my almost-ladder.

I also have a Treasury Direct account but I only use it to purchase I-Bonds. I have immediate liquidity at Schwab should I decide to get out of any of my T-Bills early. With TD I'd have to wait for them to transfer the funds.

Yep. It's a new world for me dealing with Treasuries at VG, and it's great. So much flexibility. Treasuries are extremely liquid and easy to sell if you have to -- as long as you have them on the right platform, which is not Treasury Direct. I'm letting all my Treasury Direct holdings mature out, except for the iBonds.