Treasury bills (T-bills) are a great way to invest your money in a safe and predictable way. In this blog, we’ll break down how to calculate your returns when investing in T-bills using a real example:

Example: 91-Day Treasury Bill Investment in Kenya

Example 1 :Investment Details:

• Investment Amount: KES 100,000
• Duration: 91 days
• Interest Rate (Discount Rate): 13.4496%

Let’s calculate how much you’ll earn and the total payout at maturity.

I will be using this treasury bill calculator click here

Results of Calculation

Interpretation of the results 

You will lend the government  = Kes 97,242.60 (96,756+ Tax on discount 486.6 )

At the end of 91 days you will receive= Kes 100,000

You earned an interest = Kes 2,757.

Key Points to Remember

1. Treasury Bills Are Sold at a Discount: You pay less than the face value upfront and receive the full amount at maturity.
2. Interest Is Pre-Determined: The discount rate ensures your returns are fixed, making T-bills a predictable investment.
3. Minimum Investment: In Kenya, the minimum investment for T-bills is KES 100,000, with increments of KES 50,000 for additional investments.

Why Invest in Treasury Bills?

• Low Risk: Backed by the government.
• Short-Term Investment: Ideal for investors looking for returns in under a year.
• Steady Returns: Fixed rates protect you from market volatility.

To learn more about treasury bills and treasury bonds , grab this E-book on investing in shares @Kes 500 here