Why I'm Buying Treasuries for the First Time Ever

For years, Treasuries were essentially dead money. I didn't see a reason to hold them compared to a high-yield savings account. With yields hovering around 0.1%–0.5%, holding them meant accepting near-zero returns, while they sit with less accessibity than a savings account, and while watching the stock market soar.

But today's landscape is different. Treasury money market funds like VUSXX last year were yielding around 5.24%. Meanwhile, VTWAX (Vanguard's Total World Stock Index) returned about 16.43%. That means the opportunity cost of holding Treasuries has shrunk from roughly 16% to about 11%. In other words, you're giving up less potential return for the safety of government-backed securities. That's a trade-off worth considering, especially if you're responsible for your family's financial security.

Being a dad changes how you think about money. Instead of maximizing returns at all costs, you want to ensure you can meet your family's needs no matter what happens in the markets.

Think about your kid's college fund. Would you rather have a guaranteed 5.24% return or shoot for 16.43% with the risk of significant losses if they're entering school in the next couple of years? These types of questions become more pressing when you're responsible for someone else's future.

Treasuries offer something unique: principal protection backed by the full faith and credit of the U.S. government. In a time of increasing uncertainty, that guarantee has real value to your balance, to your sanity, and to your family.

I'm not abandoning equities. The stock market remains the best vehicle for long-term wealth creation. But I am carving out a portion of my portfolio for Treasuries so that I'm never anxious to open up my brokerage app.

The exact split depends on your personal circumstances, but the interactive calculator above can help you visualize different scenarios. Remember that these are simplified calculations, and past performance doesn't guarantee future results.

For money I know I'll need in the next 1-2 years (like house maintenance or upcoming tuition payment), Treasuries at ~5% are particularly attractive. They offer better yields than many high-yield savings accounts while maintaining the same level of safety.

No one can tell you what to do with your money. Everyone's situation and appreciation for risk is different. Consider this an invitation to reconsider assumptions about "boring" investments when the opportunity cost of safety decreases. I wouldn't consider this timing the market, rather it's simply recognizing that the risk-reward balance has changed for the time being: you can get a meaningful return on truly safe assets.

As dads, we're playing a long game. Sometimes that means embracing opportunities for steady, reliable returns alongside our more growth-focused investments. In today's market, Treasuries might just deserve a place in that strategy.