Hello everyone♪
While risk assets like “stocks” and “investment trusts” are the mainstream when it comes to investing, this time I decided to try purchasing government bonds for individuals. *Government bonds for individuals are a highly safe investment where the
government guarantees no loss of principal.
“Why government bonds now?”
“What kind of strategy will I use to utilize them?”
The problem of household cash and deposits reaching a decent amount
In our household, risk assets (stocks, installment investments, etc.) have been managed using my personal money.
On the other hand, for living expenses for the family, so-called “household money”, we haven’t touched it, and have continued to quietly protect and increase it as a living defense fund and future fund while continuing to save a fixed amount every month for many years. It is a very common, unremarkable savings method of saving a fixed amount every month while both parents work🙂
The fact that such savings have reached a decent amount is what triggered me to start thinking about purchasing government bonds for individuals this time.
“It’s a waste to just let it sleep in a bank account, but since it’s family money, I can’t use it as a risk asset and risk losing it even in the worst-case scenario…” I have been thinking about this for a long time.
Our household deposit account is at a mega-bank, but should I switch to an online bank with higher regular interest rates and move the money?
Or should I switch to a time deposit?
I have considered it, but the interest rate has a lower limit of 0.5% and at most is around 1.something%.
…It’s a hassle.
The interest rate difference relative to the effort did not outweigh the hassle.
When I thought about that, I arrived at the fact that policy interest rates have been rising rapidly recently.
Come to think of it, what has the interest rate on government bonds become?
It is 1.96% for the September 2026 offering.
And in October, it became 2.07%! (Fixed 3-year)
Government bonds for individuals are more attractive than banks
The era where it was said that “it’s safe if you deposit money in a bank” lasted a long time, but due to recent changes in the interest rate environment, that common sense is starting to change.
Compared to bank ordinary deposits and time deposits, government bonds for individuals now have better yields.
“If the government guarantees the principal firmly and I can get this interest rate, isn’t there no reason not to shift some of the cash and deposits here?” This is what started me thinking about this, which was a major trigger this time.
By the way, the interest rates for government bonds for individuals offered in October 2026 are as follows.
□Variable 10-year: 2.07% (before tax / initial applicable interest rate)
□Fixed 5-year: 2.39% (before tax)
□Fixed 3-year: 2.05% (before tax)
If you know the era of ultra-low interest rates of the past, these numbers are quite attractive, aren’t they?
Here, it finally became a motivation that outweighed my sense of hassle✨️
The Reason I Chose the 3-Year Fixed Rate and Why I Waited Until October
Out of the three options, I chose the 3-year fixed-rate government bond.
The reason is clear: I have plans to use a large amount of money within the next five years. (This is just a possibility.)
If I don’t end up using it, I think I will apply for government bonds again depending on the situation at that time.
By choosing the 3-year fixed rate, which has a shorter term to maturity, I can properly prepare for the time when I need the funds, in line with my life plan schedule.
Regarding the timing of the purchase, last month (September 2026), a Bank of Japan meeting to decide on policy interest rates was scheduled for September 17th-18th, and further interest rate hikes were expected.
Therefore, instead of buying immediately, I planned to go to the bank counter in October, aiming for the timing when interest rates had risen, and purchase the government bonds for individuals directly from my savings account.
I just thought it would be nice to buy them at the best possible interest rate.
※I know that policy interest rates will likely continue to rise, and there are various arguments that choosing a 10-year floating rate and paying the penalty for early redemption would be more profitable, but that is a bit of a hassle, so I will keep it simple.
Creating a Money Circulation System by Investing the Interest Received into Child NISA
And since the interest from this government bond purchase is, to put it extremely, ‘found money,’ I initially thought about spending it however I liked.
However, the ‘interest’ that comes in every six months from the government bonds for individuals I am buying this time…
I am planning to use this interest for investment in Child NISA instead of just spending it as household pocket money.
The annual investment limit for Child NISA is 600,000 yen.
(Total limit of 6 million yen)
Although it is a rough estimate, I expect that the interest from the government bonds will cover some of it.
And, I will prepare for my child’s future tuition and other expenses.
For now, I think this will be fine for the next three years.
That is what I am thinking.
However, this is just an assumption, and it might become necessary as living expenses at that time, so I would like to consult with my wife to decide how to use it in reality.
Buy government bonds -> Use interest for Child NISA -> Use it to supplement tuition! (Cover it if possible)
This is truly the circulation of money💰️
To prepare for my child’s future tuition and living expenses, I am creating a cycle where money works for me without using a single yen of additional personal funds.
Assuming that I do not die, there will be no need to consider educational endowment insurance.
With this, I can grow the investment for my child’s future like a snowball without putting any burden on the household budget and while keeping the risk of principal loss at zero.
That is the story of how I came to purchase government bonds for individuals on a whim.
I’m a little happy to receive a small gift
I made the purchase at Mizuho Bank.
I made a reservation to visit the branch in advance.
I was shown to a back room and received very polite service. I am grateful for their pleasant demeanor.
Since I had made a reservation in advance and mentioned that I also invest, there wasn’t much explanation needed, and the procedures went quite smoothly.
Finally, I waited in the room to receive copies of the documents, and after being handed a paper bag containing them, I was escorted to the elevator.
When I looked inside the paper bag in the elevator, I saw that it contained various things…
If they had told me, I could have at least thanked them.
Thinking that, I left the bank feeling very good thanks to their polite service and the various gifts.
I’m actually quite happy with things like this.✨
Conclusion
Investing = aggressively increasing money through stocks
I don’t think that is the only correct answer.
Depending on the nature of your own money and your family’s money, you should safely protect the money that needs protecting while wisely taking advantage of the current interest rate trends.
This purchase of government bonds for individuals seems like it will be a move that further stabilizes our family’s asset management.
I hope this will be helpful for those who are similarly ‘worried about where to keep their cash and deposits’ or ‘want to safely increase their interest even a little bit’!
※Please make your final investment or purchase decisions after checking your own financial situation and the latest application requirements.🙂
Lastly…
Why is it that even though I am lending money to the country, I have to pay taxes on the interest from that country? It’s a bit strange…
Me: I’ll lend you money, so pay me back with interest!
Country: Thanks for lending it to me! I’ll pay you back with interest!
Me: It’s reached maturity, so I’ll take my money back with interest!
Country: Here is the principal and the interest! Oh, but 20% of the interest is our share, so I’ll deduct that!
Me: ???
