The author of today’s article calls them “the Rodney Dangerfield of retirement investing” as they are getting no respect. The investment in question? Treasury Inflation-Protected Securities (TIPS) – which the author notes have been producing disappointing returns in recent years compared to regular Treasurys. However, while many retirees have been abandoning TIPS in favor of regular Treasurys, he cautions that “many of the criticisms of TIPS reflect a fundamental misunderstanding” of what they can offer. For more, CLICK HERE.
They’re not likely to help you become rich, but they can help you maintain your purchasing power. Today’s article provides an examination of TIPS (treasury inflation-protected securities), a form of U.S. Treasury bond which serves as an investment option for those who are worried about their money losing its purchasing power due to inflation (such as investors who are in or approaching retirement). To read more about the pros (e.g. the two ways in which they pay off) and cons (e.g. their “irksome” tax issues) of TIPS – as well as why the best way to invest in TIPS may be through mutual funds or exchange-traded funds – CLICK HERE.
While inflation may currently be low, the author of today’s article warns that “this makes the possibility of an inflation threat going forward even more likely.” Moreover, she notes that health care costs are rising faster than inflation. All of this poses a particular threat to retirees relying on sources of income that lack inflation protection. As such, the author outlines four investment options for retirement in inflationary times – Treasury inflation-protected securities (TIPS), annuities, stocks and commercial real estate. To read about the potential benefits and drawbacks of each option, CLICK HERE.