How to use the T-bill calculator
- Enter the face value: the amount paid back at maturity, in $100 steps.
- Choose the term, from 4 weeks to 52 weeks.
- Pick the rate type you have, the discount rate or the investment rate, and enter it. Auction results and brokers show both.
- Add your federal bracket and state income tax to see after-tax interest and the matching CD rate.
T-bill interest at a 4% discount rate ($10,000 face value)
| Term | Days | You pay | Interest | Investment rate |
|---|---|---|---|---|
| 4 weeks | 28 | $9,968.89 | $31.11 | 4.07% |
| 8 weeks | 56 | $9,937.78 | $62.22 | 4.08% |
| 13 weeks | 91 | $9,898.89 | $101.11 | 4.10% |
| 17 weeks | 119 | $9,867.78 | $132.22 | 4.11% |
| 26 weeks | 182 | $9,797.78 | $202.22 | 4.14% |
| 52 weeks | 364 | $9,595.56 | $404.44 | 4.23% |
Rates change at every weekly auction; enter today's rate from TreasuryDirect's auction results or your broker.
The formulas
- Price per $100 = 100 × (1 − discount rate × days ÷ 360)
- Interest = face value − price paid
- Investment rate = (100 − price) ÷ price × 365 ÷ days
- Rolled over for a year, the effective yield (like an APY) is a little higher again, because the interest is reinvested at each maturity.
The state tax advantage
T-bill interest is exempt from state and local income tax. To compare with a CD or savings account that's fully taxed:
equivalent CD rate = T-bill rate × (1 − federal rate) ÷ (1 − federal rate − state rate)
At a 4.14% T-bill yield, 22% federal and 5% state, that's 4.42%. In a state with no income tax, the two are equal; in California or New York City the T-bill advantage is larger.
T-bills vs CDs vs high-yield savings
| T-bills | CDs | High-yield savings | |
|---|---|---|---|
| Backed by | US government | FDIC up to $250,000 | FDIC up to $250,000 |
| State tax | Exempt | Taxed | Taxed |
| Access | Sell at a broker or wait for maturity | Penalty to withdraw early | Any time |
| Rate | Set at each auction | Fixed for the term | Changes any time |
Compare the numbers with the CD calculator and the savings calculator, and read CD vs high-yield savings account.
A simple T-bill ladder
Split your cash into four parts and buy 4-, 8-, 13- and 26-week bills, then roll each one as it matures. Part of your money comes due every few weeks, and you earn T-bill rates on the rest. Keep your first month or two of emergency fund in a savings account you can reach the same day.
Track cash, T-bills and every goal
Nest tracks savings goals with target dates, so you can see how each T-bill or savings deposit moves you forward. Summit keeps every account, from cash and T-bills to retirement and property, in one net worth view. Both have a free demo with sample data.
An estimate, not investment advice. Check current rates before you buy.
Frequently asked questions
How do you calculate T-bill interest?
What's the difference between the discount rate and the investment rate?
Are T-bills taxed?
How do I buy T-bills?
Are T-bills better than a high-yield savings account?
What happens when a T-bill matures?
Written by
Finance Specialist & Editor, VaultlyApps
Emma Whitfield writes and edits the VaultlyApps money guides and free calculators. Her focus is US household finance — budgeting on a real paycheck, paying down credit card and student debt, emergency funds and savings goals, renting — and the money side of freelancing and small-business income, from pricing and profit margins to self-employment tax. Every guide is researched against primary sources such as IRS publications and the CFPB, every number is checked in our tested calculators, and tax content is reviewed each year when new IRS figures come out. Emma is not a licensed financial adviser or tax preparer; her work is general education, not personal advice.
Researched against primary US sources, checked against independent calculators and reviewed by a finance expert on our team. Written for US readers — general education, not financial, tax or legal advice. Editorial policy · Disclaimer
