Auction Results: 30-Year U.S. Treasury Bond

On Thursday June 11, 2009 the US Treasury department said it received bids totaling more than $29 billion for the $11 billion worth of 30-year notes sold. The bid-to-cover ratio, a gauge of demand, was 2.68, the highest since May 2008 and well above the average of 2.39 in the previous three 30-year reopening auctions according to Reuters.

30-Yr U.S. Treasury auction summary:

• $29.6 billion Tendered
• $11.1 billion Accepted
• CUSIP Number 912810QB7
• Series: Bonds of May 2039
  
• Interest Rate 4-1/48%
• High Yield: 4.72%
• Median Yield: 4.684%
  
• Low Yield: 4.599%
  
• Issue Date: June 15, 2009
• Maturity Date: May 15, 2039
  

For more details, see:

• US Treasury Rates at a Glance
  
  
• US Treasury Announcement - PDF File

30-YEAR TREASURY BOND (Historical Quotes for: ^TYX)

Related ETFs:

• iShares Barclays 1-3 Year Treasury Bond - SHY
• iShares Barclays 3-7 Year Treasury Bond - IEI
• iShares Barclays 7-10 Year Treasury - IEF
• iShares Barclays 10-20 Year Treasury Bond - TLH
• iShares Barclays 20+ Year Treasury Bond - TLT

ISHARES LEHMAN 20-yr+ (Historical Quotes for: TLT)

==> Very Best CD Rates with FDIC <==

• LIBOR Rates at a Glance
  
  
• 10-Year U.S. Treasury Auction Results

In every issue of The Retirement Advisor newsletter , we cover the US Treasury bonds, bills and notes plus our recommendations for fixed income investments including a full page titled "CD Rates and Maximizing Returns on Cash." Check out or free issue

FREE issue of The Retirement Advisor newsletter in pdf:

• => January 2009

Website for more information and our annual Performance Data

COLA: Social Security Cost of Living Adjustments by Year

Based on the increase in the Consumer Price Index (CPI-W) from the third quarter of 2008 through the third quarter of 2008, Social Security and Supplemental Security Income (SSI) beneficiaries received a 5.8% percent COLA for 2009.

Below are the last five adjustments

Year	COLA
2006	4.1%
2007	3.3%
2008	2.3%
2009	5.8%

For more COLAs back to 1975, see the article "Social Security Cost-of-Living Adjustments (COLAs) by Year."

In every issue of The Retirement Advisor newsletter , we cover the latest Social Security news. On page 4 of the June 2009 issue we tell how early retirees can "reset the clock" on your Social Security benefits if you go back to work so you can get the higher monthly payment when you eventually decide to retire.

FREE issue of The Retirement Advisor newsletter in pdf:

• => January 2009

Website for more information and our annual Performance Data

Vanguard to Close and Merge Funds to Preserve Yield for Current Shareholders

To preserve competitive yields in its money market funds, Vanguard will merge its Vanguard Admiral Treasury Money Market Fund (VUSXX) and Vanguard Treasury Money Market Fund (VMPXX).

• US Treasury Rates at a Glance

To protect current shareholders from dilution of yield that comes from new deposits, Vanguard also closed its "Vanguard Federal Money Market Fund" on June 2. The decision to close the fund was made "to protect the interests of current fund shareholders by limiting the fund's need to purchase new short-term federal agency securities that offer negligible yields."

The merger of Vanguard Treasury Money Market Fund, which has an expense ratio of 0.28%, into Admiral Treasury Money Market Fund, with its lower expense ratio of 0.15%, will reduce expenses for Treasury fund shareholders. After the merger, the fund is expected to maintain its expense ratio of 0.15%. Additionally, reducing new cash flow into the Vanguard Federal Money Market Fund may slow the decline of that fund's yield.

For similar reasons, Vanguard Admiral Treasury Money Market Fund and Vanguard Treasury Money Market Fund were closed to new accounts on January 26, 2009.

Vanguard Admiral Treasury Money Market Fund (VUSXX)

Closed to new investors
Category = Taxable Money Market
Expense ratio as of 12/29/2008 = 0.15%
SEC yield as of 06/03/2009 = 0.18%

Vanguard Treasury Money Market Fund (VMPXX)

Closed to new investors
Category = Taxable Money Market
Expense ratio as of 12/29/2008 = 0.28%
SEC yield as of 06/03/2009 = 0.05%

Vanguard Federal Money Market Fund (VMFXX)

Closed to new investors
Category = Taxable Money Market
Expense ratio as of 12/29/2008 = 0.28%
SEC yield as of 06/03/2009 = 0.34%

If you have less than a few million dollars to invest, I would look to invest in 6 month to 2 year CDs to get much better yield with FDIC and NCUA protection spread between several banks and credit unions.

For example, the 1-year US Treasury note is only paying 0.46% but you can get a 1-year CD at Ally Bank (formerly GMAC Bank) that pays 2.80%.

More Information about CD Rates:

• Page three of our newsletter, The Retirement Advisor, has a monthly summary of what is happening in the world of CDs, a popular feature titled "Maximizing the Returns On Your Cash" and a table of the best CD rates with links to web sites.
  
  
• See "Very Best CD Rate Survey" to get an idea what the best CD rates are for terms from 6 months to 10 years.

Charts for Vanguard Equity Index Funds:

• Total Stock Market (VTSMX)
• S&P500(VFINX)
• Extended Market (VEXMX)

Charts for Vanguard Fixed Income Funds:

• GNMA (VFIIX)
• Total Bond (VBMFX)
• TIPS (VIPSX)
• High-Yield/Junk Bond (VWEAX)

Money Market Fund Pages at Vanguard:

• Vanguard Admiral Treasury Money Market Fund (VUSXX)
• Vanguard Treasury Money Market Fund (VMPXX)
• Vanguard Federal Money Market Fund (VMFXX)

Read the full story: With yields at record lows, Vanguard announces changes to three money market funds