A Treasury bill ladder splits a sum across bills that mature on staggered dates, so a slice comes due every few weeks while the rest stays in bills at the rates of the auctions where each was bought. It is the CD ladder idea built from more rigid parts: bills run only from 4 to 52 weeks, Treasury sells seven regular terms, and they run on different auction timetables. Those facts decide which ladders can exist before rates enter the picture.
This page works through that constraint, builds one ladder week by week on illustrative numbers, and covers keeping it running. It prints no current auction rate, because rates are set afresh at every auction and TreasuryDirect's Treasury bill page links to the latest results. Nor does it say whether a ladder suits you. If bills are new to you, what Treasury bills are covers discount pricing and the auction first.
How a T-bill ladder works
A rung is one bill, or a group of bills, with its own maturity date. The spacing is the gap between one rung maturing and the next. Rolling a rung means using the money from a maturing bill to buy a new one, so the ladder keeps its shape.
A bill is sold at a discount or at par and pays its face value at maturity; the difference is your interest, and nothing is paid before then. Its rate is fixed at the auction. So a ladder produces cash only on maturity dates, and each one is a decision: buy the next rung at whatever the new auction sets, or take the money.
The seven bill terms decide the spacing
| Bill term | How often auctioned | Usual issue day | Most reinvestments TreasuryDirect will schedule |
|---|---|---|---|
| 4 weeks | Weekly | Tuesday | 25 |
| 6 weeks | Weekly | Thursday | 16 |
| 8 weeks | Weekly | Tuesday | 10 |
| 13 weeks | Weekly | Thursday | 7 |
| 17 weeks | Weekly | Tuesday | 6 |
| 26 weeks | Weekly | Thursday | 3 |
| 52 weeks | Every four weeks | Thursday | 1 |
The issue days are TreasuryDirect's usual pattern, not a promise: an issue day on a weekend or federal holiday moves to the next business day, and Treasury says its needs, policy decisions and debt-limit action can change the pattern. Cash management bills, with variable terms and no regular schedule, are not sold in TreasuryDirect and are left out here.
Two consequences follow. Both are this page's own arithmetic on that table and on how reinvestment works, not statements Treasury makes about ladders.
The staircase has gaps. The CD ladder guide uses rungs of 3, 6, 9, 12 and 15 months. Quarterly bill rungs over a year would be 13, 26, 39 and 52 weeks, and there is no 39-week bill. Nor can those rungs roll into 52-week bills as they mature: that bill is issued only every fourth week, and 13, 26 and 39 are not multiples of four. Only three pairs among the seven terms double cleanly (4 and 8 weeks, 13 and 26, 26 and 52), and the last fails for the same reason. That leaves two day-one versions of the CD ladder's logic, both with two rungs: 4- and 8-week bills for a rung every four weeks, or 13- and 26-week bills for a rung every 13.
Rolling keeps the term. In TreasuryDirect a maturing bill can be reinvested only in a new bill of the same term, and the regulation cancels the reinvestment if no bill of that type and term is issued on the day yours matures. So on automatic reinvestment every rung keeps the term it started in, and the simplest ladder to leave running that way uses one term, with rungs bought at staggered auctions. For a one-term ladder's maturities to stay evenly spaced, the spacing has to divide the term exactly, and for the 52-week bill it must also be a multiple of four weeks:
| Term | Even spacing possible | Rungs that takes |
|---|---|---|
| 4-week | Every 1 or 2 weeks | 4 or 2 |
| 6-week | Every 1, 2 or 3 weeks | 6, 3 or 2 |
| 8-week | Every 1, 2 or 4 weeks | 8, 4 or 2 |
| 13-week | Every week | 13 |
| 17-week | Every week | 17 |
| 26-week | Every 1, 2 or 13 weeks | 26, 13 or 2 |
| 52-week | Every 4 weeks | 13 |
(A single bill rolled over is left out; one rung is not a ladder. Mixing terms on automatic reinvestment adds no spacing the table lacks: one 4-week rung and two 8-week rungs, for instance, give a rung every two weeks, as two 4-week rungs do.) A rung every 13 weeks in 26-week bills is two rungs. A rung every four weeks in 52-week bills is thirteen, and buying one at each 52-week auction takes 48 weeks. Four year-long rungs a quarter apart can only be approximated: 52-week bills bought at weeks 0, 12, 24 and 36 mature at weeks 52, 64, 76 and 88, with the first rung's replacement at 104, gaps of 12, 12, 12 and then 16 weeks.
A worked T-bill ladder, week by week
The example takes the 13-week shortcut: $10,000 of face value, a rung maturing every 13 weeks, built in one go on the CD ladder's logic of staggered starting terms, each rolled into the longest term as it matures.
- Rung A: $5,000 face in a 13-week bill.
- Rung B: $5,000 face in a 26-week bill.
Both are bought in week 0. Every rate below is illustrative: a 4.000% discount rate at the auctions in weeks 0 and 13 (the same for both terms, for simplicity; real auctions price each term separately), then a fall to 3.000% for every auction after week 13, there to show how a ladder reacts, not to forecast anything. Prices follow the regulation's formula, price per $100 = 100 × (1 − discount rate × days ÷ 360), with 91 days for a 13-week bill and 182 for a 26-week bill, rounded to six decimals and then to the cent.
| Week | What happens | Bill bought | Illustrative discount rate | Price paid | Interest on the rung that matured |
|---|---|---|---|---|---|
| 0 | Build the ladder | A: 13-week, $5,000 face; B: 26-week, $5,000 face | 4.000% | $4,949.44 + $4,898.89 = $9,848.33 | — |
| 13 | A matures and pays $5,000 | 26-week, $5,000 face (a new purchase) | 4.000% | $4,898.89 | $50.56 |
| 26 | B matures | 26-week (reinvestment) | 3.000% | $4,924.17 | $101.11 |
| 39 | A's 26-week bill matures | 26-week (reinvestment) | 3.000% | $4,924.17 | $101.11 |
| 52 | B's replacement matures | 26-week (reinvestment) | 3.000% | $4,924.17 | $75.83 |
| 65 | A's replacement matures | 26-week (reinvestment) | 3.000% | $4,924.17 | $75.83 |
What happens at each maturity:
- Week 0. $9,848.33 buys $10,000 of bills. The $151.67 gap is the interest the two bills pay when they mature.
- Week 13. Rung A pays $5,000. A 13-week bill can be reinvested only into another 13-week bill, so turning it into a 26-week rung is a new purchase. TreasuryDirect takes advance orders for auctions up to eight weeks ahead, but you do not know the rate when you order; the auction sets it. Here the new bill costs $4,898.89 and $101.11 is left over as cash.
- Week 26 onwards. Each maturing 26-week bill is reinvested in another. IRS Publication 550 says you receive the difference between the maturing bill's proceeds and the new bill's price; TreasuryDirect credits it to your bank account, or to your zero-interest certificate of indebtedness (C of I) if the original bill was bought with it. Neither source says outright that the new bill keeps the old face value; the example assumes so, each rung stays at $5,000 face, and $75.83 comes back at every roll at the illustrative 3.000%. Nothing compounds unless you put it back yourself.
- The rate fall. It reaches rung B at week 26, but rung A, rolled at week 13, still pays its 4.000% interest at week 39; only from then do both rungs hold bills bought at the lower rate. That lag, at most one rung's term (here 26 weeks), is the ladder's whole defence against falling rates. Had rates risen, the same lag would have held the ladder back.
Taking the cash instead. With no reinvestment scheduled, TreasuryDirect pays a maturing bill's value to your bank account or C of I automatically. The ladder then has one rung fewer (here, money every 26 weeks instead of every 13) until you buy back in.
Week numbers are a sketch. Both 13- and 26-week bills are usually issued on Thursdays, so a maturing rung meets a new issue the same day, but holidays and Treasury's own changes move dates; each auction announcement gives the real ones.
Keeping the ladder running
In TreasuryDirect
Automatic reinvestment keeps a TreasuryDirect ladder going without an order at every maturity, within limits set out on TreasuryDirect's reinvestment page:
- Opt in, in time. Schedule a reinvestment when you buy the bill or later, up to four business days before it matures; change or cancel it while the new auction is more than four business days away. TreasuryDirect also says it closes the option four business days before the relevant auction, so act before then.
- Same term, capped. The caps are the last column of the first table, and bills can be scheduled for multiple reinvestments up to two years. The regulation, 31 CFR 363.205, still prints older 2010 limits (25 for a 4-week bill, 7 for 13-week, 3 for 26-week, one for everything else) that predate the 6-, 8- and 17-week bills; TreasuryDirect's table is the current one.
- In the example. Three reinvestments scheduled on rung B at purchase give maturities at weeks 26, 52, 78 and 104; the same on rung A's 26-week bill at week 13 gives 39, 65, 91 and 117. Between weeks 13 and 104 the ladder needs no order from you. When a schedule runs out, that bill pays out at maturity unless another reinvestment has been scheduled.
- What cancels a reinvestment. No matching bill being issued; a new bill costing more than the maturing one pays, without funds to cover the difference (TreasuryDirect names a tax-withholding election as one cause); or moving the bill: a partial transfer always cancels its reinvestments, and a full one does too unless it goes to another TreasuryDirect account with the same taxpayer identification number or to your minor linked account.
- ID.me. After 28 October 2026, ID.me is the only way to sign in to TreasuryDirect online. Without it you cannot make new purchases or set up new reinvestments, though reinvestments already scheduled carry on uninterrupted; you just cannot view, edit or cancel them until you complete ID.me setup. The example's week-13 order is a new purchase.
TreasuryDirect charges no fees. How to buy Treasury bills covers opening the account, placing orders and the reinvestment feature.
At a brokerage
A brokerage that buys bills at auction for you may offer its own automatic roll, under its own rules. One large brokerage's service, checked for this page, applies only to Treasury securities bought at auction (not on the secondary market, and not cash management bills), rolls each into the same term and face value, reinvests the maturing principal but not interest, and keeps rolling until you cancel it, sell part of the position or add to it, or the matching auction is no longer available. Other firms' versions may differ on any of those points. A brokerage can also sell a bill for you before it matures, normally for a fee and at the secondary-market price.
What a T-bill ladder does and does not do
It does three things:
- Puts a slice of the money in reach on a schedule, every 13 weeks in the example, without selling anything.
- Averages the rate across several auctions instead of staking the whole sum on one.
- Fixes each rung's rate for its term, because a bill's rate is set at its auction.
It does not:
- Protect against falling rates beyond the longest rung: 52 weeks at most, 26 in the example. After that, every rung earns whatever the auctions pay, and you place each order before the auction sets it.
- Make money reachable between maturities cheaply. To sell a bill held in TreasuryDirect early, you first transfer it to a bank, broker or dealer on FS Form 5511, and a bill bought there with new money must be held 45 days before it can move, so a 4-week bill bought there can never be sold early.
- Defer tax by rolling. Bill interest is generally reported when each bill is paid at maturity, and Publication 550 says reinvesting does not change that: you report the full interest on each bill by the time it matures. How Treasury bill interest is taxed covers the federal rule and the state exemption.
- Carry deposit insurance. The FDIC lists Treasury bills as not covered and notes that they are backed by the full faith and credit of the U.S. government.
T-bill ladder vs CD ladder
The mechanics match, and the CD ladder guide sets them out. The differences are in the parts:
| T-bill ladder | CD ladder | |
|---|---|---|
| Longest rung | 52 weeks | Whatever terms the bank sells; the guide's example runs to 15 months |
| Spacing | Limited by seven terms and their auction timetables | Set by the CD terms on offer |
| State and local income tax on the interest | Exempt; federal tax applies | Bank interest gets no such exemption |
| Leaving a rung early | No penalty; you sell at the market price through a bank, broker or dealer, normally for a fee | A contractual early-withdrawal penalty |
| Protection | Backed by the full faith and credit of the U.S.; not FDIC-insured | An FDIC-insured deposit, within the coverage limits |
| At maturity, if you do nothing | TreasuryDirect pays out | Many bank CDs renew automatically |
Whether the tax exemption outweighs a CD's rate depends on your state and bracket; HYSA vs CD vs T-bills runs that after-tax arithmetic.
Where the next rung's rate comes from
Each rung's rate comes from the auction it is bought in. Treasury publishes every auction's results on TreasuryDirect, a TreasuryDirect account shows your own order's result on auction day after the auction closes, and the Treasury bill page links to recent results. The rules move too: the 6-week bill became a regular term only in February 2025, and TreasuryDirect's sign-in changes after 28 October 2026.
Four decisions before building one
- How often you need money. That sets the spacing; the spacing table shows which terms deliver it.
- How long you will lock each rung. A bill ladder tops out at 52 weeks.
- Where to hold it. TreasuryDirect is free and reinvests within its caps; a brokerage can sell before maturity and sets its own roll rules.
- What the money is for. Money that might be needed on any given day sits awkwardly in any ladder, which is why the emergency-fund page keeps bills to the back portion of a large fund.
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