If you are an investor looking to add low risk investments to your portfolio to add diversity, government bonds are a great way to do this. When you learn how to invest in government bonds, you should also learn the importance of diversifying in both high and low risk investments to protect your future growth.

Decide Between the Bond Options

Are you interested in purchasing savings bonds or other types of bonds, such as TIPS and T bills? If all you want to buy is savings bonds, you can purchase them from your local bank or online from the treasury department. But if you want to invest in TIPs, T bills, or T bonds, or you want to buy bonds at auction, you will have to go to the treasury department's website. You won't be able to purchase these at your local bank.

The Treasury Direct website is very simple to navigate and use. You will be directed to set up an account. All of your bonds will be held in the same account for easy access. Because the purchase is done online, you won't have to worry about keeping paper bonds. Everything is digital and electronic. Treasury Direct is a government website, so it is safe and secure. You can set up your account to automatically withdraw money from your paycheck and invest in these bonds if you are so inclined.

Local Banks

If you would rather purchase I bonds and EE bonds rather than those offered by the Treasury, you can purchase these savings bonds from most local banks. Start by asking a bank teller for an order form, and fill out all the necessary information. If you are giving the bond as a gift, be sure you have the name, address, and social security number of the recipient. You have to have a social security number to make the transaction, so if you don't have the SSN of the recipient, use your own. In this case, the bond will be mailed to you.

The key to navigating the bond market is to study the yields. Some municipal bonds offer more reward, but also come with more risk of default. Lower yielding bonds have very low risk. Keep the risk and reward balance in mind as you continue to research investing in government bonds. Remember that you need to do your own investment research. Don't take anyone's word for it when it comes to your retirement planning and investments. It is your money, and what happens to it will ultimately be your responsibility. Good luck.