If you’ve ever tried to buy bonds from the Treasury Department, you might’ve run into your share of hurdles. 

Users have complained about several issues they’ve encountered with TreasuryDirect, including but not limited to having to individually punch in each character of their password on a virtual keyboard (which the website removed earlier this year); filling out a form and going to a bank in-person in order to get a bank seal or signature guarantee stamp if the system can’t verify who they are; or getting easily locked out of their accounts.

Through TreasuryDirect, you can buy Treasury marketable securities, which include notes, bills and bonds, along with non-marketable securities such as Series EE Savings Bonds and Series I Savings Bonds, commonly known as I bonds. 

Ken Tumin, senior industry analyst at LendingTree, said he had to add a new bank to his TreasuryDirect account last year, which entailed filling out a form that required a signature guarantee at a bank, then sending it by mail. It took several weeks for his account to get updated. 

Luke Molinaro, a 30-year-old resident of Monroe, Wisconsin, said he set up a TreasuryDirect account last October so he could buy I bonds. The process was easy, but when he logged in earlier this year to see how his investment was looking, he recalls getting locked out after incorrectly entering his password and failing to answer all of his security questions accurately. Now he has to call TreasuryDirect to regain access. 

“The whole thing just kind of felt cumbersome,” he said.

Molinaro said he has accounts at other financial institutions that should be high security, too, but the login process is much more seamless. 

I bonds have garnered greater attention in recent years as their interest rates have increased. They’re considered an attractive investment because they’re very low risk (since they’re backed by the U.S. government) and considered inflation-proof. 

The composite rate for I bonds issued between May and October 2023 stood at 4.3%, but that rate is now climbing up. The Treasury Department recently announced that the composite rate for bonds issued between November 2023 and April 2024 stands at 5.27%.

Beginning last May, I bonds paid even more, offering a record composite rate of 9.62%. 

How I bonds work

They have a maturity of 30 years.

The composite rate is made up of two rates: a fixed rate, which will remain the same rate you bought it at throughout its lifespan, and a variable rate, which is based on the Consumer Price Index.

So that means when inflation goes up, so will the variable and composite rates.

The composite rate is set every May and November and typically changes each time. 

“We saw massive spikes at that time in the number of folks coming in. In just a year, we set up almost twice as many accounts as we had set up in the 10 years prior. And so that really put a lot of strain on the system at the time,” said Matt Garber, the chief customer officer for the U.S. Treasury’s Bureau of the Fiscal Service. 

From 2011 to 2021, a total of 2.4 million TreasuryDirect accounts were created. In 2022 alone, 3.7 million accounts were created. 

The Bureau of the Fiscal Service was aware of the issues customers experienced, which is why they’ve rolled out a series of changes to the TreasuryDirect website beginning more than a year ago.

In May 2023, they removed the virtual keyboard you had to use if you wanted to log in, and introduced a one-time passcode that is sent to your email.

If you forgot or mistyped your password, the system used to present you with a list of 10 security questions, prompting you to answer the three that you had answered when setting up your account, Garber explained.

“It was a very kind of burdensome process, particularly if you hadn’t really gone into TreasuryDirect for a while, and you wanted to get in to buy the I bond,” Garber said. 

In May 2022, TreasuryDirect streamlined the question process, presenting you with just the security questions you had actually answered.

People can still get locked out if they don’t remember their answers, and you will have to call a representative to regain access. But Garber said hold times are now under a minute. Wait times have improved because users are able to more easily do things on their own (such as reset their passwords without having to remember which security questions they initially answered), more staff members are supporting the call center, and there’s been an overall decline in volume from when the I bond interest rate was at its highest.

Another major issue some users face is having to verify their identity when they’re setting up an account. They might have to fill out an account authorization form with information that includes their name, home address and Social Security number in the presence of a certifying officer or notary. The certifying officer then has to provide an official stamp or seal. 

Garber said they expanded who counts as a certifying official back in March 2022. 

“You don’t have to just go to a branch of a commercial bank,” he said. “Any certifying official, whether at a courthouse, a notary public, is able to validate that you presented your identity, and you are who you say you are to open that account. That has created much more ease for folks.”

Because TreasuryDirect has made it easier to validate who you are upon sign-up, fewer people have to send in these forms, Garber added. 

You also had to send in a form if you wanted to change your bank account information, like Ken Tumin of LendingTree had to do. New technology solutions also allow TreasuryDirect to validate that the account belongs to you, letting you change that information online. 

“We want to get the products in your hand. We want to be really helpful. But we also don’t want to be part of a process that ends in the stealing of someone’s identity or the stealing of someone’s assets,” Garber said. 

Garber said the Treasury’s retail securities program has typically been “sleepy.” The Bureau of the Fiscal Service had to handle a massive surge in new accounts after the interest rate for I bonds reached that historic high of 9.62%.

“I think we did our best to be as responsive as possible in a tough situation. It’s a 20-year-old system based on 20-year-old code,” Garber said. “While the peak has kind of died down, we continue to see relatively high levels of interest in adding an account for TreasuryDirect.” 

Garber said that now that I bond customers are in the system and aware of TreasuryDirect’s offerings, they’re interested in and buying their other products, like Treasury bills and Treasury Inflation-Protected Securities (TIPS). 

The bureau wants to continue investing in improving customers’ experience with the Treasury’s retail securities program, Garber noted. 

LendingTree’s Ken Tumin pointed out that you can buy Treasury bills, Treasury notes and TIPS at many brokerage firms outside of the TreasuryDirect system, which comes with advantages. 

“You don’t have to wait ‘till maturity at a brokerage firm, you can sell it on their secondary market,” he said. “If you have one of those securities at TreasuryDirect, you can’t sell it on the market. You have to wait ‘till maturity to redeem it or to be able to cash it out.” 

If you bought a marketable security from TreasuryDirect and want to sell it before maturity, you’ll have to transfer the security to a bank, broker or dealer, which you can’t do if it’s been in your TreasuryDirect account under 45 days.

But TreasuryDirect is the only place you can buy U.S. savings bonds. LendingTree’s Ken Tumin said he’s aware the site has improved, and thinks the changes he’s seen are “a step in the right direction.”