Tips
I am 75 and retired. My wife has a couple of years before retirement. I am trying to decide whether to add to my short term tips mutual fund holdings or purchase a tips ladder. I understand the advantages of individual tips and I would be confident in the purchase of a five year tip at auction. However I am not confident in choosing 2,3 and 4 year tips in the secondary market because of all of the variables. I don’t believe we would need tips interest for expenses. It would simply be an anti-inflationary investment as part of our fixed income allocation. What do you think? tips mutual fund or individual tips ladder?
Terry Says
Are you aware of the tax consequences of owning TIPS outside of a retirement account? You pay taxes on the accrued interest every year — even though you don’t take it out!
This can be complicated. I think at this point, you are better off laddering Treasury Bills. They tend to keep up with inflation.
Read this: https://www.terrysavage.com/t-bills-beat-cds/
