T-Bill vs Savings Account Calculator (After-Tax HYSA Comparison)

Free tool · After-Tax Comparison · Instant results

Compare Treasury Bills vs High-Yield Savings Accounts (HYSA) after all taxes. T-Bills lock in a rate and avoid state tax, while savings accounts offer flexibility but variable rates.

💡 In high-tax states, T-Bills often outperform savings accounts — even at the same rate — because they are exempt from state tax.

How much are you investing? ($)

T-Bill Rate (%)

Check latest rate → TreasuryDirect.gov

T-Bill Duration

The savings account is compared over the same period.

Your Savings / HYSA Rate (%)

APY from your bank (e.g. Marcus, Ally, SoFi).

Federal Tax Bracket (%)

State Tax Rate (%)

CA = 13.3%, NY = 10.9%, TX/FL = 0%. T-Bills are state-tax exempt — savings accounts are not. Find your rate →

How to Compare T-Bills vs Savings Accounts

Check the T-Bill rate vs your savings account APY
Apply federal tax (both are taxed)
Apply state tax (T-Bills are exempt)
Compare final after-tax returns

This calculator automatically performs all these steps and shows which option gives you higher returns.

Worked Example

    📘 $10,000 for 26 weeks — 4.5% T-Bill vs 4.5% HYSA, 22% federal tax, 9% state tax

    T-Bill result:

    Profit = $10,000 × 4.5% × (182 ÷ 360) = $227.50

    Federal tax = $50.05    State tax = $0 (exempt)

    You keep = $177.45

    Savings / HYSA result:

    Profit (compound daily) = $226.26

    Federal tax = $49.78    State tax = $20.36

    You keep = $156.12

    T-Bill wins by $21.33 — same headline rate, but the state tax exemption makes the difference.

How This Calculator Works

The formula (done automatically for you):

T-Bill profit = Investment × Rate ÷ 100 × Days ÷ 360
T-Bill tax = Profit × Federal Rate (state tax = $0, always exempt)
Savings profit = Investment × (1 + Rate ÷ 365)^Days − Investment (compounds daily)
Savings tax = Profit × Federal Rate + Profit × State Rate
You keep = Profit − All taxes

T-Bill vs Savings Account — Full Comparison

Feature	T-Bills	Savings / HYSA
Issuer	U.S. Government (Treasury)	FDIC-insured bank
Safety	U.S. Gov backed — no limit	FDIC insured up to $250,000
Rate Type	Fixed at auction — locked in	Variable — can drop anytime
Federal Tax	✅ Yes — ordinary income	✅ Yes — ordinary income
State Tax	✅ Exempt by federal law	❌ Fully taxable
Liquidity	Fixed maturity — no early exit on TreasuryDirect	Withdraw anytime, no penalty
Min. Investment	$100 on TreasuryDirect	Often $0 — no minimum
Over $250K	✅ No limit — fully government backed	❌ Not insured above $250K per bank
Rate Stability	Locked in at purchase	Can be cut anytime by the bank

T-Bill vs HYSA — Key Differences That Impact Your Returns

Both T-Bills and HYSAs are safe, competitive options for idle cash. The critical differences are rate stability and state tax treatment:

    Rate stability: When you buy a T-Bill, your rate is locked in for the full duration.
    A HYSA rate can be cut by your bank tomorrow — and in a falling rate environment, banks are quick to lower rates.
    In 2024, several major online banks cut HYSA rates multiple times within months of Fed rate cuts.
  

    State tax advantage: T-Bill earnings skip state and local tax entirely.
    At California's 13.3% state rate, a T-Bill at 4.5% is equivalent to a HYSA paying over 5.7%.
    In states with no income tax, this advantage disappears.
  

When Should You Choose T-Bills?

You live in a high state-tax state (CA, NY, NJ, OR) — state tax exemption adds real value
You won't need the money for at least 4 weeks — can commit to a fixed maturity
You want to lock in today's rate before the Fed cuts — HYSA rates fall immediately after cuts
You have more than $250,000 — T-Bills have no insurance cap unlike bank accounts
You want the absolute safest investment — U.S. government vs FDIC-insured bank

When Should You Use a Savings Account or HYSA?

You need instant access to your money anytime — emergency fund, daily expenses
You live in a state with no income tax (TX, FL, NV) — the T-Bill tax advantage disappears
You want zero setup — no TreasuryDirect account needed
You want to start with less than $100
Your HYSA rate is significantly above current T-Bill rates

🧾 T-Bill Tax Equivalent Yield Calculator

Find your real after-tax T-Bill yield and the HYSA rate needed to match it.

Calculate After-Tax →

Related Calculators

T-Bill Calculator Open →

T-Bill vs CD Open →

T-Bill vs Bond Open →

T-Bill vs Money Market Open →

Break-Even Calculator Open →

After-Tax Yield Open →

Learn more: What Are Treasury Bills — Complete Guide · Are T-Bills Worth It? · Best T-Bill Duration Guide

Frequently Asked Questions (FAQ)

Are T-Bills better than a high-yield savings account?

T-Bills are often better than high-yield savings accounts for short-term investing after taxes. They lock in a fixed rate and are exempt from state tax, while savings account rates can change anytime. However, savings accounts offer instant access to your money, whereas T-Bills require holding until maturity.

What is the key difference between T-Bills and savings accounts?

The key difference is that T-Bills lock in a fixed rate, while savings account rates can change anytime. T-Bills also avoid state tax, but savings accounts provide instant access to funds. This makes T-Bills better for returns and savings accounts better for flexibility.

Which is better for an emergency fund?

A high-yield savings account is better for an emergency fund because you can access the money instantly. T-Bills are better for funds you will not need for a few weeks or months. Many investors split their emergency fund between both options.

Can I lose money in T-Bills compared to a savings account?

No, you cannot lose money in T-Bills if you hold them until maturity. They return the full face value backed by the U.S. government. You may only see small losses if you sell early on the secondary market.