Open an account with an online broker or dealer that sells bonds. Most dealers will require that you open an account with at least $5,000.
Step2
Deposit the required amount in the account by mailing a check to the broker or dealer.
Step3
Decide what type of bond you want to buy, then visit the Bond Market Association's Web site (bondmarkets.com) and check out yields and other features of the various bonds.
Step4
Check out other Web sites that list bond information, looking for the best total returns, not just the best yields.
Step5
Calculate a bond's "yield to call," or how much money you'll get if you redeem early. The higher the yield, the more money you'll make.
Step6
Indicate which bond you want to buy and how much you want to invest.
Step7
Keep in mind that the broker's commission is usually built into the bond price.
Step8
Await verification. The brokerage will verify that you have enough money in your account to cover the transaction, then it will buy the bonds.
Step9
Get confirmation of the purchase. You should receive a trade confirmation by mail several days after the bond has been bought.
Step10
Buy government bonds directly from the U.S. Bureau of the Public Debt Web site (publicdebt.treas.gov). If you buy bonds on this Web site, you can pay by credit card or a bank debit card, provided the bank card carries the MasterCard or Visa logo.
Tips & Warnings
If you don't have enough money to buy individual bonds or if you want a diversified, laddered portfolio of bonds, consider investing in a bond fund, or a mutual fund that focuses on bond investments.
Comments
Anonymous said
on 11/22/2005 Go to Munidirect.com. They have, by far, the best pricing and they are very easy to work with.