If you’ve been comparing Treasury bills vs CDs in 2026, you’re asking exactly the right question. Both pay more than a savings account. Both are safe. But they’re not the same — and for the 55-year-old with $100,000 in cash to protect, choosing wrong costs real money.
Here’s the bottom line upfront: right now, 6-month T-Bills yield around 4.3% and top 6-month CDs sit around 4.5%. CDs win on raw rate. But once you factor in taxes, liquidity, and your state’s income tax situation, the answer flips for many people. Let’s break it down.
Treasury Bills vs. CDs in 2026: The Rate Comparison
As of late June 2026, here’s where rates stand after the Fed held at 3.50–3.75% and removed its projected 2026 cut:
- 4-week T-Bill: ~4.25%
- 13-week T-Bill (3 months): ~4.30%
- 26-week T-Bill (6 months): ~4.30%
- 52-week T-Bill (1 year): ~4.15%
- Top 3-month CD: ~4.75%
- Top 6-month CD: ~4.50%
- Top 12-month CD: ~4.00%
- Top 18-month CD: ~3.90%
On paper, CDs win. But that’s before taxes — and taxes are where this gets interesting.
The Tax Difference Nobody Talks About
This is the most important distinction between Treasury bills vs CDs in 2026 — and most people miss it.
Treasury bills are exempt from state and local income taxes. CDs are not — you pay federal AND state tax on CD interest.
If you live in a high-tax state, this changes everything. Here’s the math on a $100,000 investment for someone in the 22% federal bracket:
In a Zero State Income Tax State (Texas, Florida, Nevada)
- 6-month CD at 4.50%: $2,250 gross → $1,755 after 22% federal tax
- 6-month T-Bill at 4.30%: $2,150 gross → $1,677 after 22% federal tax
- CD wins by $78 on $100,000
In a High State Tax State (California at 9.3%, New York at 6.85%)
- 6-month CD at 4.50%: $2,250 gross → ~$1,530 after federal + state tax
- 6-month T-Bill at 4.30%: $2,150 gross → $1,677 after federal only (no state tax)
- T-Bill wins by $147 on $100,000
The higher your state income tax, the more T-Bills outperform CDs — even when CDs show a higher advertised rate. Use the TTF Financial Calculators to run your exact after-tax numbers based on your state.
Liquidity: Which One Lets You Out Early?
This is the second major difference between Treasury bills vs CDs in 2026.
Treasury Bills
T-Bills trade on the secondary market. You can sell them before maturity through TreasuryDirect or your brokerage — you’ll get market price, which may be slightly above or below face value depending on rate movements. In practice, for short-term T-Bills (under 6 months), the difference is minimal. Effectively liquid.
CDs
Most CDs charge an early withdrawal penalty — typically 90–180 days of interest. On a 12-month CD, breaking it early costs you a quarter of your earnings or more. Not liquid without a penalty.
If there’s any chance you’ll need access to this cash — a home repair, a medical bill, a market opportunity — T-Bills give you flexibility. CDs lock you in.
Where to Buy Each One
Treasury Bills
- TreasuryDirect.gov — buy directly from the government, no fees, minimum $100
- Your brokerage (Fidelity, Schwab, Vanguard) — auto-rollover available, easier interface
- New T-Bills auction every week — you set a non-competitive bid and get the going rate
CDs
- Online banks (Ally, Marcus, Synchrony, Discover) — consistently highest rates
- Credit unions — sometimes beat banks, especially on short terms
- Brokered CDs (through Fidelity, Schwab) — same FDIC protection, can be sold on secondary market like T-Bills
- Avoid big bank CDs (Chase, BofA) — rates are dramatically lower
Which One Is Safer?
Both are about as safe as it gets — but they’re backed differently.
Treasury bills are backed by the full faith and credit of the U.S. government. No limit. No insurance cap. If the U.S. defaults, every financial institution has far bigger problems.
CDs are backed by FDIC (banks) or NCUA (credit unions) insurance — up to $250,000 per depositor, per institution. Above that, you’re exposed. If you have more than $250,000 in cash, either split across institutions or use T-Bills for the overflow. Check your coverage at FDIC.gov.
Frequently Asked Questions
Are Treasury bills better than CDs in 2026?
It depends on your state tax rate. If you live in a state with no income tax, CDs usually win on raw yield. If you’re in a high-tax state like California or New York, T-Bills often win after tax — even with a slightly lower advertised rate. Run your after-tax numbers before deciding.
Do I pay taxes on Treasury bill interest?
Yes — at the federal level. T-Bill interest is subject to federal income tax but is exempt from state and local income taxes. This is the key advantage over CDs in high-tax states.
Can I lose money on a Treasury bill?
Not if you hold to maturity. You buy at a discount (say $9,750) and receive face value ($10,000) at maturity. If you sell early on the secondary market, price fluctuates slightly with rate movements, but for short-term T-Bills the risk is minimal.
What’s the minimum to buy a Treasury bill?
$100 on TreasuryDirect.gov. At most brokerages, $1,000. There’s no maximum — institutions buy millions in a single auction.
Should I ladder Treasury bills or CDs in 2026?
You can ladder either — or both. A mixed ladder (some T-Bills for liquidity and tax efficiency, some CDs for slightly higher yield) gives you the best of both worlds. See the TTF Blueprint for a step-by-step ladder strategy built for the current rate environment.
The Bottom Line
Comparing treasury bills vs CDs in 2026 comes down to three things: your state tax rate, how liquid you need to stay, and how much cash you’re protecting.
Quick decision guide:
- High-tax state (CA, NY, NJ, IL)? T-Bills likely win after tax — even at a lower advertised rate.
- No state income tax (TX, FL, NV)? CDs usually win on yield. Shop online banks.
- Might need the cash early? T-Bills. CDs penalize early withdrawal.
- Over $250,000 in cash? T-Bills for the overage — no FDIC cap to worry about.
Either way, both beat the 0.38% national savings average by 10x. The worst move is leaving your cash in a traditional savings account while this rate window stays open.
Ready to build the right ladder for your situation? The TTF Blueprint walks you through the exact allocation — T-Bills, CDs, and HYSA — based on your timeline and tax state.
Calculate the real cost to your savings: inflation impact calculator.