Should I put my nest egg in a 30-year Treasury bond?

With interest rates higher, I’m considering putting my nest egg in a 30-year Treasury bond . They’re paying about 5.25%, which looks pretty good to me. I’m conservative with my money, and Treasurys are safe, right?

If, by “safe,” you mean there is little risk you won’t get paid in full and on time, then yes — Treasury bonds are considered safe by most people. But that does not mean their prices can’t fall. Video 111/1 Skip Ad Continue watching after the adVisit Advertiser websiteGO TO PAGE Ethan Allen’s CEO on Effective Leadership StrategiesSee All Videos Ethan Allen’s CEO on Effective Leadership Strategies Play video: Ethan Allen’s CEO on Effective Leadership Strategies **Read:**Investors see big opportunity in ferocious 2026 bond-market rout Don’t Short Yourself offers weekly money tips to help you earn it, stack it and grow it.

I agree to the Terms of Use, Privacy Notice and Cookie Notice. I would like to receive updates and special offers from Dow Jones and affiliates. I can unsubscribe at any time.

There are two common ways bonds lose value. The first involves credit risk. If a bond issuer defaults — meaning it fails to make an interest or maturity payment — or the market fears a default is likely, the bond’s price can drop.

When the market value of a bond drops, its effective yield rises. Today, you can easily find stories arguing that the national debt is weakening the country’s finances and helping drive the recent rise in interest rates. **Read:**These bond strategies can help you get a safe 5% return on your cash That brings us to the second common way bonds lose value. The rise in interest rates not related to default concerns; inflation is the reason most often cited for rising rates right now.

When rates rise, bond values drop. Suppose that, on Sept. 30, you could have paid $1 million for a 30-year Treasury bond with a 5.6% coupon, a maturity value of $1 million and a maturity date of Sept. 30, 2056. On March 31, 2027, and every six months after that, you would receive $28,000 in interest, which is half of 5.6% of $1 million.