Why Are Bonds So Secure?

Most people who invest in bonds will buy U.S. Treasuries because they're so safe. Treasury bonds sold by the U.S. government are effectively risk-free; Uncle Sam has never defaulted on a bond. Ever. (The federal government can't skip town, and if it runs out of cash to pay back loans, it can literally print more.) You have four basic choices: Treasury bills have a maturity of less than a year. That means within one year they will be paid back in full with interest. If you have a money market savings account, your cash will likely be invested in T-bills Treasury notes mature in two, three, five, seven or 10 years Treasury bonds mature in 30 years Treasury Inflation-Protected Securities (TIPS) mature in five, 10 or 30 years, and they increase in value along with inflation

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