Buy Bonds Directly: A Guide to Purchasing Bonds Without a Broker

How to Buy Bonds Without a Broker. Bonds are debt securities on which the issuer pays interest over a certain amount of time to buyers. Although many people use a broker for this process, it can be easy to purchase different types of bonds without the services of a securities broker or dealer. Bonds, unlike stocks, are usually available directly from the authorities that issue them, which can save you money on broker's fees or commissions.

Step 1

Determine which type of bond you want to purchase, whether it be issued from the federal government, a local or state government or a corporation. Generally, corporate bonds can be purchased directly from the company in question without the services of a broker, while government bonds can be issued directly through the Treasury department.

Step 2

Use your personal bank or financial institution to purchase various types of bonds without a broker, such as U.S. savings bonds or central government bonds. If you are an account holder or customer that meets certain requirements, you may be able to avoid being charged fees or commissions for the purchase of bonds.

Step 3

Buy Treasury bonds directly from the U.S. Treasury department, using the Treasury Direct website (see Resources below). You create an account on the website, which will allow you to buy and sell bonds directly, track the amount of interest you have earned and know when your bonds have matured and have stopped earning interest.

Step 4

Contact the Federal Reserve directly to purchase Treasury bonds. You can locate the nearest branch from the website of the Federal Reserve Board (see Resources below). You will also completely avoid fees and commissions using this method.

Step 5

Consider an online financial trading website such as e-Trade to purchase bonds (see Resources below). While you will be still required to pay a commission on each purchase, you will still be able to conduct your transactions without the services of a broker. In addition, many types of investment information is available free to subscribers with such services.

Tip

Bonds are generally rated according to the risk involved in having the issuer repay the debt to you. Bond ratings range from AAA, which is the lowest possible investment risk, to CCC, which has the highest risk.