Fixed income securities
A fixed income security is for the investor looking for a steady (fixed) stream of retirement income with no changes or surprises; and many times, they pay a higher interest the longer they mature.
- Guaranteed rate of return when held to maturity
- Flexible interest payment options
- Predictable fixed payments
- Short, medium, and long-term maturities
These securities guarantee a rate of return when held to maturity and can provide a steady stream of monthly or quarterly income.
These are short-term and medium-term securities, issued by federal agencies. While they are not direct obligations of the United States, most offer government securities of sponsorship and a higher rate of return than Treasuries of comparable term lengths.
Treasury Bills (T-Bills)
These are short-term securities that can mature at three months, six months, and one year. T-Bills are sold at a discounted face value and upon maturity pay out the full face value amount.
Typically issued and redeemed at face value, these notes pay out a fixed rate of interest every six months until they mature. Maturities range from two to ten years or more.
Agency Discount Notes
Like Treasury Bills, these are sold below face value and mature to face value in short-term intervals.
Agency Medium-Term Notes
Comparable to Treasury Notes, these notes are offered for fixed periods of time and pay interest on a semi-annual basis.
Typically issued and redeemed at face value, these bonds pay out a fixed rate of interest every six months until they mature. Maturities range from two to ten years or more.
These are debt obligations issued by public or private corporations. Funds are used for things like building facilities, purchasing equipment, and expansion.
These bonds are issue by states, cities, counties, and other government entities to fund public projects such as building schools or highways.
Time to mix it up
Every investment decision comes with its own risk and reward; diversifying your investment choices can help reduce risk. Learn how to use asset allocation to your advantage when designing your investment strategy.
Keep in mind
- Both Treasury and Agency Securities are not bank deposits, and do not qualify for FDIC insurance.
- Principal value is not only subject to risk when sold before maturity date but also market fluctuations.
- Government bonds and Treasury bills are guaranteed by the US government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value.
- Agency securities are guaranteed by the U.S. government as to the timely payment of principal and interest, however this guarantee does not apply to the yield, nor does it protect against loss of principal if the bonds are sold prior to the payment of all underlying mortgages. To determine which investment(s) may be appropriate for you, consult your financial consultant prior to investing
Securities and insurance offered through LPL or its affiliates are:
Not Insured by FDIC or Any Other Government Agency
Not Bank Guaranteed
Not Bank Deposits or Obligations
May Lose Value
Securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC). Insurance products are offered through LPL or its licensed affiliates. Webster Bank and Webster Investments are not registered as a broker-dealer or investment advisor. Registered representatives of LPL offer products and services using Webster Investments, and may also be employees of Webster Bank. These products and services are being offered through LPL or its affiliates, which are separate entities from, and not affiliates of, Webster Bank or Webster Investments.
The LPL Financial Registered Representatives associated with this site may only discuss and/or transact securities business with residents of the following states: CT, MA, RI, NY.
The Webster Symbol is a registered trademark in the U.S.
¹Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and bonds are subject to availability and change in price. The market value of corporate bonds will fluctuate, and if the bond is sold prior to maturity, the investor’s yield may differ from the advertised yield.
Municipal bonds are subject to availability and change in price. They are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise. Interest income may be subject to the alternative minimum tax. Municipal bonds are federally tax-free but other state and local taxes may apply. If sold prior to maturity, capital gains tax could apply.
Government bonds and Treasury bills are guaranteed by the US government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value.