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    Treasury bill calculator

    Treasury bills are quoted on a bank-discount basis, which is not the return you earn. This calculator converts the quoted discount into the price you pay, the coupon-equivalent yield and the annualised return, so a bill can be compared fairly with a CD or a money-market fund.

    Term182 dQuoteDiscountBasisActual/360
    Price paid
    $9,757
    For $10,000 of face value
    Discount
    $242.67
    182 days to maturity
    Investment yield
    4.988%
    Coupon-equivalent, 365-day basis
    Annualised return
    5.050%
    Compounded to a full year
    Quote to return
    The discount yield is not the return: it is quoted on face value over a 360-day year.
    182 days
    Quote to return
    MeasureValue
    Face value$10,000
    Discount yield (quoted)4.800%
    Price$9,757
    Discount dollars$242.67
    Investment yield (365)4.988%
    Annualised (compounded)5.050%

    A bill quoted at 4.8% on a 182-day basis returns about 4.99% on the money actually invested.

    Inspect the model
    Choose a quick result view, a scaled comparison, or the complete diagnostic set.
    Price against term
    Longer bills are discounted further for the same quoted yield.
    Price against term$0$2.2k$4.5k$6.7k$8.9k$11.2k28d28d59d59d90d90d121d121d152d152d183d183d214d214d245d245d276d276d307d307d338d338dPrice
    Three ways to quote the same bill
    Discount yield always understates the return.
    Three ways to quote the same bill0.0001.192.383.584.775.964.80DiscountDiscount4.99InvestmentInvestment5.05AnnualisedAnnualised%
    Canonical equations
    The exact relationships implemented by this engine.

    F − F·d·(days/360) · Bank-discount basis.

    (discount / price)·(365/days) · Coupon-equivalent, the number to compare with a CD.

    (F/price)^(365/days) − 1 · Compounded, comparable to an APY.

    finance methodology

    A clear path from inputs to results.

    Treasury bills are quoted on a bank-discount basis, which is not the return you earn. This calculator converts the quoted discount into the price you pay, the coupon-equivalent yield and the annualised return, so a bill can be compared fairly with a CD or a money-market fund.

    Step-by-step methodWorked exampleAssumptions explained

    How to use

    1. Enter the face value.
    2. Enter the quoted discount yield.
    3. Set the days to maturity.
    4. Compare the investment yield with deposit rates, not the quoted discount.

    The formula

    P=F(1−dn360),yinv=F−PP⋅365nP = F\left(1 - d\frac{n}{360}\right), \qquad y_{inv} = \frac{F-P}{P}\cdot\frac{365}{n}

    Reference: US Treasury bill auction conventions: bank-discount basis, actual/360.

    Worked example

    $10,000 face, 4.8% discount, 182 days

    Inputs
    • Face value $10,000.
    • Discount 4.80%.
    • 182 days to maturity.
    Calculation path
    1. 1

      Discount: 10,000 × 0.048 × 182/360 = $242.67.

    2. 2

      Price: $9,757.33.

    3. 3

      Investment yield: 242.67/9,757.33 × 365/182 = 4.988%.

    4. 4

      Annualised: (10,000/9,757.33)^(365/182) − 1 = 5.06%.

    Result

    Price $9,757.33 · investment yield 4.99% · annualised 5.06%.

    Interpreting the result

    The quoted discount always understates the return, because it is calculated on face value over a 360-day year rather than on the money you actually invest over 365 days. On short bills the gap is small; on a 4-week bill it is proportionally larger.

    Assumptions & limitations

    • Held to maturity; no secondary-market sale.
    • No commissions or account fees.
    • Single bill; laddering and reinvestment are not modelled.

    Frequently asked questions

    Why is the investment yield higher than the discount?

    The discount is computed on face value, but you only invest the price. Dividing by the smaller number raises the yield.

    How does this compare with a CD?

    Compare the investment yield with the CD APY. Bills are exempt from state income tax, which can make a slightly lower yield better after tax.

    Are T-bills risk-free?

    They carry no credit risk from the US government, but they do carry reinvestment and inflation risk.

    Methodology last reviewed 2026-10-21. Results are informational and not financial or engineering advice — see our disclaimer.