How to Choose Treasury Bonds — Guide to Types and Strategies

What are Treasury Bonds?

Treasury bonds are debt securities issued by the State Treasury. By buying a bond, you lend money to the state, and in return you receive interest. This is one of the safest forms of investment — the state budget is the guarantor.

Types of Savings Bonds

The Ministry of Finance offers several types of savings bonds for individual investors:

OTS — 3-month

• Interest rate: fixed, ~3.0% annually
• Period: 3 months
• For whom: Short-term "parking" of cash
• Minimum amount: PLN 100

DOS — 2-year

• Interest rate: fixed, ~3.25% annually
• Period: 2 years
• For whom: Saving for a specific goal within 1–2 years
• Minimum amount: PLN 100

TOZ — 3-year (variable rate)

• Interest rate: WIBOR 6M + margin
• Period: 3 years
• For whom: Investors expecting interest rate increases
• Minimum amount: PLN 100

COI — 4-year (inflation-indexed)

• Interest rate: inflation + margin (e.g., 1.25%)
• Period: 4 years
• First year: fixed rate (e.g., 6.55%)
• For whom: Medium-term inflation protection
• Minimum amount: PLN 100

EDO — 10-year (inflation-indexed)

• Interest rate: inflation + margin (e.g., 1.50%)
• Period: 10 years
• First year: fixed rate (e.g., 6.80%)
• For whom: Long-term capital protection against inflation
• Minimum amount: PLN 100

ROS — 6-year (family, from 800+ program)

• Interest rate: inflation + 1.50%
• Period: 6 years
• For whom: Beneficiaries of the 800+ program
• Minimum amount: PLN 100

Which Bond to Choose?

Goal: emergency fund (0–6 months)

Choose: OTS (3-month)

Quick access to money. Low interest rate, but better than on current account. Remember that early redemption involves a fee.

Goal: saving for specific expense (1–3 years)

Choose: DOS (2-year) or TOZ (3-year)

Fixed interest rate of DOS provides predictability. TOZ is better when interest rates are rising.

Goal: inflation protection (3–10 years)

Choose: COI (4-year) or EDO (10-year)

These are the most popular bonds among conscious investors. EDO offers higher margin above inflation, but requires longer horizon. COI is a compromise between protection and flexibility.

Goal: building retirement portfolio

Choose: EDO (10-year)

Long horizon + inflation protection = ideal safe part of retirement portfolio. Combine with stock ETFs.

Where to Buy Treasury Bonds?

1. Online: obligacjeskarbowe.pl — official service
2. Banks: PKO BP, mBank, Pekao and others offer purchase through online banking
3. Sales points: PKO BP branches

Early Redemption — How Much Does It Cost?

You can redeem bonds before maturity, but this involves a fee:

The fee is deducted from accrued interest.

Bonds and Taxes

• Interest is subject to capital gains tax (19%)
• Tax is automatically deducted upon redemption
• Bonds are not available on IKE/IKZE accounts (but consider bond ETFs within these accounts)

Ladder Strategy

Instead of putting everything into one issue, spread purchases over time:

1. Month 1: buy EDO for PLN 2,000
2. Month 2: buy COI for PLN 2,000
3. Month 3: buy EDO for PLN 2,000
4. And so on...

This way every few months another series matures, giving you regular access to part of your capital.

How Can Freenance Help?

Freenance allows you to track treasury bonds as part of your portfolio:

• Bond value — current value with accrued interest
• Maturity calendar — when which bonds expire
• Allocation — what percentage of portfolio bonds vs stocks/ETFs represent
• Runway — include bonds in Financial Freedom Runway calculations

👉 Add bonds to your portfolio in Freenance — freenance.io