Buying Treasuries not CDs

For my fixed income bonds, I'm buying Treasuries, not CDs, to lock in 5% rate for longer terms.   Simply, Treasuries guarantee paying the same coupon rate until maturities.   Most, if not all, long term CDs are callable, meaning if interest rates fall, the bank will terminate the CD early.   Call dates are as little as 3 months to one year in the future for 10 year CDs.   So if interest rates drop, that will be the end of one's CD.

Coupon rates of 5% for Treasuries have historically be high and therefore, attractive.   Of course, interest rates may rise further, but I don't expect them to stay high for long.   Also, I wouldn't mind buying some Treasuries at 6 or 7% yield if that should happen.

To address the risk of rising interest rates, I'm scaling in over the year when buying Treasuries, instead of committing all of the funds in a single purchase.  That way, if interest rates should rise, I will still have funds to invest in bonds.   If interest should fall, I will have locked in at least 5% for part of my fixed income funds.

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This is not financial, bond investment, nor investment advice. Please consult a professional advisor.

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