The Safest Long-Term T-Bill Ladder Strategies for 2025

$\text{The}$ $\text{Safest}$ $\text{Long}$-$\text{Term}$ $\text{T}$-$\text{Bill}$ $\text{Ladder}$ $\text{Strategies}$ $\text{for}$ $\mathbf{2025}$

In $\text{2025}$, Treasury $\text{Bills}$ ($\text{T}$-$\text{Bills}$) remain the benchmark for safety and liquidity, backed by the full faith and credit of the $\text{US}$ government. For investors holding significant cash, the best way to maximize yield and maintain flexibility is through a **$\text{T}$-$\text{Bill}$ $\text{Ladder}$** strategy. This approach is particularly effective in the current environment of an inverted or normalizing yield curve.

A $\text{T}$-$\text{Bill}$ ladder involves dividing your cash into equal portions and investing each portion into $\text{T}$-$\text{Bills}$ with staggered maturity dates. As each $\text{T}$-$\text{Bill}$ matures, the funds become available, which you can then reinvest in a new, longer-term $\text{T}$-$\text{Bill}$ to maintain the ladder structure.

$\text{Core}$ $\text{Advantage}$ $\text{of}$ $\text{T}$-$\text{Bill}$ $\text{Ladders}$:

$\text{Safety}$ $+$ $\text{Liquidity}$ $+$ $\text{Minimized}$ $\text{Rate}$ $\text{Risk}$

$\text{Yields}$ $\text{are}$ $\text{generally}$ $\text{exempt}$ $\text{from}$ $\text{state}$ $\text{and}$ $\text{local}$ $\text{taxes}$.

$\text{Strategy}$ $\text{1}$: $\text{The}$ $\text{Short}$-$\text{Term}$ $\text{High}$-$\text{Yield}$ $\mathbf{(\text{Inverted}}$ $\mathbf{Curve}$ $\mathbf{Focus)}$

As of $\text{2025}$, short-term $\text{T}$-$\text{Bills}$ (under $\text{52}$ weeks) often offer competitive or even higher yields than longer-term Treasuries, thanks to the recent **inverted yield curve** phenomenon.

$\text{The}$ $\text{90}$-$\text{Day}$ $\text{Rolling}$ $\text{Ladder}$

This strategy is ideal for high-cash balances where liquidity and safety are paramount, such as large emergency funds or funds earmarked for a major purchase in the next year.

**$\text{Structure}$:** Divide your principal into four equal parts. Invest in $\text{4}$-$\text{week}$, $\text{8}$-$\text{week}$, $\text{13}$-$\text{week}$, and $\text{17}$-$\text{week}$ $\text{T}$-$\text{Bills}$.
**$\text{Mechanism}$:** Every four weeks, a $\text{T}$-$\text{Bill}$ matures. You reinvest that portion immediately into a new $\text{17}$-$\text{week}$ $\text{T}$-$\text{Bill}$.
**$\text{2025}$ $\text{Advantage}$:** You lock into current high short-term rates but have funds available every month if rates rise (to reinvest at the higher rate) or if you need the cash.

$\text{Strategy}$ $\text{2}$: $\text{The}$ $\text{Mid}$-$\text{Term}$ $\text{Flexibility}$ $\mathbf{(\text{Normalizing}}$ $\mathbf{Curve}$ $\mathbf{Focus)}$

If you believe the $\text{Federal}$ $\text{Reserve}$ has finished raising rates and that the yield curve will normalize (meaning longer-term rates will rise), this ladder balances current high yields with preparation for a steeper yield curve.

$\text{The}$ $\text{Six}$-$\text{Month}$ $\text{Staggered}$ $\text{Ladder}$

This approach uses slightly longer-term $\text{T}$-$\text{Bills}$ to capture higher yields but still provides regular access to capital.

**$\text{Structure}$:** Divide your principal into four parts. Invest in $\text{13}$-$\text{week}$, $\text{17}$-$\text{week}$, $\text{26}$-$\text{week}$, and $\text{39}$-$\text{week}$ $\text{T}$-$\text{Bills}$.
**$\text{Mechanism}$:** $\text{Bills}$ mature every $\text{13}$ weeks (quarterly). When the $\text{13}$-$\text{week}$ portion matures, reinvest it into a $\text{39}$-$\text{week}$ $\text{T}$-$\text{Bill}$.
**$\text{2025}$ $\text{Advantage}$:** This strategy provides slightly better yield than the shorter ladder while maintaining **quarterly liquidity**. It's a great middle ground for long-term savings you might need unexpectedly.

$\text{How}$ $\text{to}$ $\text{Execute}$ $\text{Your}$ $\text{T}$-$\text{Bill}$ $\text{Ladder}$ $\text{($\text{Two}$ $\text{Methods}$)}$

The entire process of buying $\text{T}$-$\text{Bills}$ is simple because they are sold at auction and do not carry commission fees.

$\text{Method}$ $\text{A}$: $\text{TreasuryDirect}$ $\text{($\text{Direct}$ $\text{Purchase}$)}$

This is the simplest and safest way, bypassing brokerage fees entirely.

**$\text{Process}$:** Create an account, fund it, and purchase the desired $\text{T}$-$\text{Bills}$ at auction.
**$\text{Best}$ $\text{Feature}$:** $\text{You}$ can use the **$\text{Reinvest}$ $\text{Feature}$** to automate the rolling process. For instance, you can set a $\text{17}$-$\text{week}$ $\text{T}$-$\text{Bill}$ to automatically reinvest for up to $\text{2}$ years, simplifying the ladder maintenance.

$\text{Method}$ $\text{B}$: $\text{Brokerage}$ $\text{Account}$ $\text{($\text{Liquidity}$ $\text{Focus}$)}$

Using a brokerage account ($\text{e.g.}$, $\text{Fidelity}$, $\text{Schwab}$) is easier if you already use one and provides greater liquidity if you need to sell the $\text{T}$-$\text{Bill}$ before maturity (though this exposes you to minor interest rate risk).

**$\text{Process}$:** Search for the $\text{CUSIP}$ or $\text{T}$-$\text{Bill}$ offering by maturity date. Select the **$\text{Non}$-$\text{Competitive}$ $\text{Bid}$** to ensure you receive the average auction rate.

For conservative investors seeking both capital preservation and yield optimization in $\text{2025}$, the $\text{T}$-$\text{Bill}$ ladder offers unmatched safety and flexibility, especially when executed through an automated system like $\text{TreasuryDirect}$.

Need help setting up your automated T-Bill ladder?

We can create a personalized ladder schedule based on your liquidity needs and capital size.

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This video provides a practical, step-by-step guide on how to buy T-Bills and set up a ladder, reinforcing the concepts discussed. [How to Buy T-Bills & Create A Treasury Ladder](https://www.youtube.com/watch?v=F_S9G8w-oYI)