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TIPS Versus I Bonds

I Bonds boast tax advantages, but purchase limits reduce appeal.

bogleheads tips vs bonds

When investors think about adding explicit inflation protection to their portfolios, Treasury Inflation-Protected Securities, or TIPS, are usually top of mind, as it’s easy to obtain exposure to these securities by scooping up a mutual fund or exchange-traded fund. But investors looking to add explicit inflation protection have another option: I Bonds, which made headlines in 2022 thanks to their lush real yields.

What Are I Bonds?

I Bonds are Treasury bonds that pay a fixed rate of interest as well as another layer of interest that varies with the current inflation rate, as measured by the Consumer Price Index . The inflation adjustment is made twice a year. I Bonds issued Nov. 1, 2023, through April 30, 2024, yield 5.27%, composed of a fixed rate of 1.3% and a semiannual inflation adjustment of 1.97%. That’s up a bit from the most recent rate of 4.30%.

I Bonds are available only to individuals—that’s why there are no I Bond funds—and they’re available with face values as low as $25 directly from the U.S. Treasury. I Bonds reach their final maturity 30 years after issuance, but investors can cash them in 12 months after purchase. If you redeem an I Bond within five years of buying it, however, you’ll forfeit three months’ worth of interest.

I Bonds don’t pay you income while you own the bond. Rather, the interest accrues and gets paid out when you sell or the bond matures.

The Pros of I Bonds

High real yields—arguably the safest inflation-adjusted yield available today—are the key attraction to I Bonds. And because I Bonds don’t make regular interest payments, holders aren’t on the hook for any taxes until they sell or the bond matures. So if you plan to buy and hold an I Bond for many years, it’s fine to do so within a taxable account—you won’t owe taxes on the accrued interest until you no longer own the bond. When you do pocket income from I Bonds after they mature or you sell, you’ll owe federal tax but not state or local. And those who use I Bond proceeds to pay for college expenses will be able to skirt federal tax, too, assuming they (and their expenses) meet certain criteria . Because I Bonds already come with an element of tax deferral, you can’t hold them inside an IRA .

The Cons of I Bonds

Purchase constraints are the major drawback. New I Bond purchases are currently restricted to just $10,000 per year per Social Security number, with an additional $5,000 in I Bonds available for purchase through tax refunds. That purchase limit is a major drawback for larger investors looking to build a meaningful bulwark against inflation.

And because I Bonds don't make regular interest payments but instead pay you your income when you sell, they're not a good option for those looking to fund any part of their living expenses with the current interest from the bonds. I Bonds are very safe, but they don't offer daily liquidity as would be available through a money market fund or online savings account, for example.

What Are TIPS?

Like I Bonds, TIPS include an element of inflation protection. An important distinction, however, is that TIPS’ principal values are adjusted to incorporate the current inflation rate, whereas I Bonds receive an adjustment in their interest rates to reflect inflation. TIPS’ interest payments also vary with the CPI, but indirectly; when investors’ principal values are adjusted for inflation, their interest payments will also adjust.

Both individuals and other institutions, such as mutual funds, can buy TIPS—they’re sold in $100 increments and are only available in electronic form. TIPS carry terms of five, 10, and 30 years. But in contrast with I Bonds, which don’t change hands in the secondary market (your only options are to wait until the bond matures or redeem it at the Treasury), you can sell TIPS to another investor via a broker. You can buy TIPS directly from the government at TreasuryDirect.gov , or you can buy individual TIPS via your brokerage firm. You can also buy a mutual fund or ETF dedicated to TIPS.

The Pros of TIPS

An important advantage of TIPS versus I Bonds is that individual investors face virtually no purchase constraints. (The upper limit on TIPS purchases runs into the millions.) That makes them the only reasonable option for larger investors looking to build a sizable stake in inflation-fighting investments.

Moreover, the fact that TIPS sell on the secondary market, as well as the availability of TIPS mutual funds, gives TIPS investors an element of liquidity that’s not available for I Bond investors, who need to wait at least 12 months after purchase to redeem their bonds. The fact that you can sell TIPS to other investors also allows you to capitalize on price changes in the bonds. That can be a double-edged sword, however, in that TIPS’ prices can fluctuate to the downside.

Another advantage is that TIPS make regular, semiannual interest payments, whereas I Bond investors only receive their accrued income when they sell. That makes TIPS preferable to I Bonds for those seeking current income.

The Cons of TIPS

The tax treatment of TIPS is a major disadvantage. TIPS investors pay tax on their income payments as well as the inflation adjustment made to their principal values, making them a far better choice for tax-sheltered accounts like an IRA or 401(k) than a taxable account . Moreover, investors who invest in TIPS by buying a mutual fund could lose money over their holding periods. TIPS trade on the open market and can be volatile, especially over shorter time periods; a TIPS fund’s daily pricing reflects that volatility. In 2022, for example, TIPS funds lost 12%, on average, owing to pressure from higher interest rates, and TIPS funds have also posted small losses for 2023 so far.

How to Decide Between I Bonds and TIPS

For many investors, the decision about whether to purchase TIPS or I Bonds isn’t either/or. It’s both. I Bonds are one of the best sources of safe, real yields available today. On the other hand, the purchase limitations on I Bonds are so restrictive that for larger investors, TIPS are the only way to build meaningful inflation protection into their portfolios in a short period of time.

Editor’s Note: This article previously appeared on May 18, 2023.

The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies .

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What is your favorite bond fund for the 3 fund portfolio and why?

Post by ksualum » Thu Feb 08, 2024 5:57 pm

Re: What is your favorite bond fund for the 3 fund portfolio and why?

Post by Johm221122 » Thu Feb 08, 2024 6:06 pm

Post by DesertGator » Thu Feb 08, 2024 6:26 pm

Post by Johm221122 » Thu Feb 08, 2024 6:31 pm

Post by mikejuss » Thu Feb 08, 2024 6:32 pm

Post by ksualum » Thu Feb 08, 2024 6:56 pm

Johm221122 wrote: ↑ Thu Feb 08, 2024 6:31 pm I just remembered this past post viewtopic.php?t=153127

Post by Johm221122 » Thu Feb 08, 2024 6:57 pm

ksualum wrote: ↑ Thu Feb 08, 2024 6:56 pm Johm221122 wrote: ↑ Thu Feb 08, 2024 6:31 pm I just remembered this past post viewtopic.php?t=153127

Post by gavinsiu » Thu Feb 08, 2024 6:58 pm

User avatar

Post by billyo44 » Thu Feb 08, 2024 7:01 pm

Post by ksualum » Thu Feb 08, 2024 7:08 pm

Post by Lastrun » Thu Feb 08, 2024 7:20 pm

ksualum wrote: ↑ Thu Feb 08, 2024 7:08 pm I forgot my reasoning. I use BIV because of Larry Swedroe but used to hold BND.....

Post by ksualum » Thu Feb 08, 2024 7:27 pm

Post by jebmke » Thu Feb 08, 2024 7:30 pm

ksualum wrote: ↑ Thu Feb 08, 2024 7:27 pm Great links. I just can't wrap my head around TIPS because I have to buy them on treasury direct and it just creates another investment account I have to deal with. I know that is a lazy answer, but perhaps that is why I use the lazy 3 fund approach.

Post by jaMichael » Thu Feb 08, 2024 7:37 pm

User avatar

Post by Cocoa Beach Bum » Thu Feb 08, 2024 7:56 pm

Post by muffins14 » Thu Feb 08, 2024 8:16 pm

ksualum wrote: ↑ Thu Feb 08, 2024 5:57 pm Given the recent discussions around BND and the pluses or negative of it, I am curious to hear for fellow three funders on this website, what is you favorite bond fund for your bond allocation of your portfolio and why? This might help some people nervous about their bond holdings with the recent inflation changes.

User avatar

Post by nisiprius » Thu Feb 08, 2024 8:19 pm

Image

Post by Tom_T » Thu Feb 08, 2024 8:39 pm

User avatar

Post by id0ntkn0wjack » Thu Feb 08, 2024 8:43 pm

nisiprius wrote: ↑ Thu Feb 08, 2024 8:19 pm I think Total Bond is just fine and people are being fussy connoisseurs when they overanalyze it.

Post by Gaston » Thu Feb 08, 2024 10:34 pm

User avatar

Post by camillus » Thu Feb 08, 2024 10:45 pm

Post by ksualum » Thu Feb 08, 2024 11:13 pm

Tom_T wrote: ↑ Thu Feb 08, 2024 8:39 pm ksualum wrote: ↑ Thu Feb 08, 2024 7:27 pm Great links. I just can't wrap my head around TIPS because I have to buy them on treasury direct and it just creates another investment account I have to deal with. I know that is a lazy answer, but perhaps that is why I use the lazy 3 fund approach.

Post by ksualum » Thu Feb 08, 2024 11:18 pm

DesertGator wrote: ↑ Thu Feb 08, 2024 6:26 pm Really would help to know a teeny bit more about you. A survey of stock vs. bond allocation is going to result in every amount from 0% Stock/100% bond to 100% Stock/0% bond. Approx how old are you? At what age/in how many years will you need the $ to spend? Why did you choose 60/40 or whatever? What is the breakdown in taxable and tax deferred? These are not necessarily the right questions, but these kinds of answers help us give meaningful responses.

Post by Kinkajou82 » Fri Feb 09, 2024 12:23 am

Post by iim7V7IM7 » Fri Feb 09, 2024 12:44 am

Post by 22twain » Fri Feb 09, 2024 12:02 pm

id0ntkn0wjack wrote: ↑ Thu Feb 08, 2024 8:43 pm I think "Fussy Connoisseurs" would make a great band name.

Post by Bubba24 » Fri Feb 09, 2024 12:58 pm

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TIPS vs. Nominal Treasury Bonds

TIPS (Treasury Inflation-Protected Securities) are US government bonds that provide a specific after -inflation return (i.e., “real return”) as compared to traditional “nominal” bonds which provide a specific before -inflation return.

We’ve discussed before when it makes sense to use individual TIPS as opposed to TIPS funds . But we’ve never discussed when to use TIPS at all — as opposed to nominal Treasury bonds.

What Inflation Do You Expect?

The most obvious way to choose between TIPS and nominal treasury bonds is to compare the market’s inflation expectation to your own inflation expectation.

For example, as I’m writing this, the yield on 10-year TIPS is 1.01%, and the yield on a 10-year nominal Treasury bond is 2.64%. What we can conclude here is that the market is estimating inflation will average roughly 1.63% (2.64% minus 1.01%) per year over the next decade.

If you expect inflation to be above the market’s expectation (1.63% in this case), TIPS are a better bet. If you expect inflation to be below the market’s expectation, go with nominal bonds.

What if you don’t have any guesses about inflation?

Of course the above analysis isn’t particularly helpful if, like me, you don’t spend much time pondering what the rate of inflation will be over any given period. If that’s the case, you’ll have to come up with another way to choose your allocation between TIPS and nominal bonds.

In such a scenario, the most important differences between TIPS and nominal bonds are that:

  • TIPS make planning easier, but
  • Nominal bonds may be more useful as a diversifier of a mostly-stock portfolio.

Using TIPS for Planning

In almost every situation, inflation-adjusted returns are more meaningful than nominal returns. As such, TIPS’ inflation-adjusted yield makes them much more useful for planning purposes.

For example, TIPS can be an excellent tool for retirement portfolios. While they’re not risk-free , TIPS can be used to provide a high degree of safety for sustaining a given (low) inflation-adjusted withdrawal rate (e.g., liquidating 3% of your portfolio in your first year of retirement, then increasing the dollar amount that you liquidate each year in order to keep up with inflation).

Bonds as a Diversifier

If you’re only holding a small amount of bonds, and you’re doing it solely to reduce the volatility of a mostly-stock portfolio, nominal bonds may be the better bet. The reason is that, in crisis scenarios, investors tend to flock toward extremely safe investments — especially nominal Treasuries. As a result:

  • Nominal Treasury bonds seem to perform better during market crashes, and
  • Nominal Treasury bonds’ correlation to stock market returns has been lower than that of TIPS.

That said, TIPS are still relatively new, so these conclusions are based on a very small amount of data.

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What no mention of I Bonds? TIPS in a taxable account tend to eat away at your inflation gains. TIPS for the most part should go in retirement accounts. I Bonds in your taxable allocation.

Am I paranoid for being wary about a conflict of interest here? The (insolvent) entity who has to make good on TIPS is also the entity who decides what the official rate of inflation is, right?. Inflation is a soft enough figure that I have no doubt it could be fudged half a percentage point south if it was convenient to do so. If TIPS became a popular investment vehicle, there could be considerable institutional pressure to decide the lower number was the ‘right’ one.

Yes, the US government is the party that gets to decide how to calculate CPI, which does expose a TIPS investor to some degree of related risk.

On the other hand, the US government is also (to a degree) in charge of inflation itself. So a case can be made that an investor in nominal Treasuries is exposed to the risk that the US government will intentionally cause inflation, thereby reducing the real return the investor receives.

It’s not as simple as what your expectation for inflation is. TIPS are also about insuring against worse-than-expected inflation. If TIPS are priced for 1.5% inflation, and I expect that inflation is likely to be 1% with a small probability of it being 50%, it could make sense for me to pay a “premium” for TIPS as insurance.

You’re right. And on the other side, buyers of nominal Treasuries are supposedly paying a slight liquidity premium.

That’s why I used the word “roughly” above, as I don’t know of any way to calculate the value of these two premiums.

bogleheads tips vs bonds

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TIPS vs I-Bonds

Get the facts about TIPS vs I-bonds and decide which is best for you.

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Vintage Bond - Background

Trying to decide if TIPS (Treasury Inflation Protected Securities) or I-bonds belong in your investment portfolio? Both TIPS and I-bonds are government-backed investments that will protect your principal while earning interest. Unlike other investments, the interest rate is periodically adjusted for inflation. Let’s dig into their benefits, risks and differences and see which option matches your needs. 

What is a bond? 

Bonds are IOUs issued by corporations, federal, state and local governments and their agencies. When you buy a bond , you become a creditor of the corporation or government entity; you are owed the amount shown on the face of the bond (par value) , plus interest. 

What are Treasury inflation-protected securities (TIPS)?  

Treasury inflation-protected securities ( TIPS ) are designed to provide inflation protection.  They are sold as five, 10 or 30 year notes that are indexed to the rate of inflation on a daily basis as measured by the Consumer Price Index (CPI) . Unlike other Treasury securities, where the principal is fixed, the principal of a TIPS can go up or down over its term. 

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Interest and earnings. TIPS owners receive interest payments twice per year. The payments on TIPS are based on the interest rate set at auction. The principal amount will adjust every six months according to inflation, which in turn determines the interest payment.

Buying, redeeming and selling TIPS. New TIPS can be purchased at auction at TreasuryDirect or from a bank, broker or dealer. The minimum purchase is $100 and TIPS are sold in increments of $100. The price and interest rate are determined at auction. Unlike I-bonds, TIPS are marketable securities and can be resold on the secondary market prior to maturity.

When the TIPS matures, if the principal is higher than the original amount, you get the increased amount. If the principal is equal to or lower than the original amount, you get the original amount.

What are I-bonds? 

Series I savings bonds (I-bonds) protect you from inflation. I-bonds earn interest based on a fixed rate and inflation rate. Your bond's value grows both because it earns interest and because the principal value gets bigger. Unlike TIPS, you choose whether to report each year's earnings or wait to report all the earnings when you get the money for the bond. Even better, if you use the money for qualified higher education expenses, you may not have to pay tax on the earnings. 

Interest and earnings. The actual rate of interest for an I-bond is a combination of a fixed rate and an inflation rate. The combined rate can, and usually does, change every 6 months. The new rates are announced every May 1 and November 1. Rate changes for your bond occur every 6 months from the issue date of your bond.

I-bonds earn interest monthly and it is compounded semiannually, meaning that every 6 months, the bond’s interest rate is applied to a new principal value. The new principal value is the sum of the prior principal and the interest earned in the previous 6 months. Your bond's value grows both because it earns interest and because the principal value gets bigger.

Buying, redeeming and selling I-bonds . You can purchase electronic I-bonds at any time online at TreasuryDirect . The minimum purchase is $25, and the maximum annual limit is $15,000. You may buy a maximum of $10,000 worth of I-bonds electronically and up to $5,000 of paper I-bonds. However, paper I-bonds can only be purchased using your federal tax refund.

While I-bonds mature fully after 30 years, you can cash them in after a year. If you redeem the bond in less than five years, you’ll lose the last three months of interest, but the interest accrued before that is yours to keep. There is no interest penalty for cashing in the bonds after five years. U.S. savings bonds can not be resold, only redeemed.

Three key differences:

  • TIPS can be resold on the secondary market. I-bonds can not be resold. 
  • TIPS can be bought in five, 10 and 30 year maturities. I-bonds are sold in 30 year terms only
  • You can buy up to $10 million worth of TIPS at auction and an unlimited amount in the secondary market. I-bonds purchases have an annual limit of $15,000 total —$10,000 in electronic bonds and $5,000 in paper bonds — per Social Security number 

Three key similarities: 

  • Interest payments are subject to federal income tax but exempt from state and local taxes
  • Each is backed by the full faith and credit of the U.S. government, designed to hedge against inflation and has a component that is adjusted in line with CPI movements
  • Both TIPS and I-bonds can be redeemed after 12 months and prior to maturity 

Bottom line

If inflation and investment safety are your chief concerns — TIPS and I-bonds deliver both. TIPS offer greater liquidity and the higher yearly limit allows you to stash far more cash in TIPS than I-bonds. If you’re saving for education, I-bonds may be the way to go. Interest earned from I-bonds may be excluded from federal income taxes if you use the money for qualified education expenses and don’t exceed income limitations. TIPS and I-bonds offer you two great ways to safely save for the future. 

Related content

  • What Are I-Bonds?
  • Best Bond Funds to Buy
  • Inflation-Proof Your Finances
  • Retirees, Plan for the Tax Hit From Savings Bonds

Donna joined Kiplinger as a personal finance writer in 2023. She spent more than a decade as the contributing editor of J.K.Lasser's Your Income Tax Guide and edited state specific legal treatises at ALM Media. She has shared her expertise as a guest on Bloomberg, CNN, Fox, NPR, CNBC and many other media outlets around the nation. Donna graduated from Brooklyn Law School and University at Buffalo. 

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bogleheads tips vs bonds

IMAGES

  1. TIPS vs IBonds (h/t Tipswatch) : r/Bogleheads

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  2. “Bogleheads’ Guide To Investing” Portfolios

    bogleheads tips vs bonds

  3. TIPS vs. I Bonds tactics?

    bogleheads tips vs bonds

  4. comparing I bonds to TIPS

    bogleheads tips vs bonds

  5. “Bogleheads’ Guide To Investing” Portfolios

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  6. The Bogleheads' Guide To Investing (Summary)

    bogleheads tips vs bonds

VIDEO

  1. BOE Bond Sale Attracts Traders Buying Scarce UK Debt

  2. Shares vs Debentures vs Bonds

  3. Stocks vs Bonds #investing101 episode 27 #valueinvesting #investingforbeginners

  4. What is the difference between Treasury bills and bonds?

  5. BOE 's First QT Auction Sells £750 Million of Bonds

  6. 401k Option #3 Three Fund Portfolio: Investing in Retirement Account for 2024

COMMENTS

  1. I Bonds vs TIPS

    Pricing transparency The TIPS prices (and yields) are set by the market. The I-Bonds fixed rates are set by the U.S. Treasury. As the bond issuer, the U.S. Treasury has an incentive to set the fixed rates on I-Bonds as low as they feel they can to still reach their desired sales goals.

  2. 20 years of TIPS vs BND, why bother with bonds?

    TIPs may have lower sharpie ratio but unlike Total US Bond, they haven no possibility of default and have a higher return. So why bother with bonds, why not simply have entire fixed income in treasury inflation protected securities? https://www.portfoliovisualizer.com/bac ... tion4_2=12 And here is something even more interesting.

  3. Treasury Inflation Protected Security

    Treasury Inflation-Protected Securities (TIPS) are a type of notes and bonds issued by the U.S. Treasury. TIPS are unique because their principal and interest payments are indexed to the rate of inflation as measured by the Consumer Price Index. TIPS explicitly protect you from inflation. Other "nominal" bonds do not. [1]

  4. Individual TIPS vs TIPS Funds

    Individual TIPS vs TIPS Funds. by Prudence » Thu Feb 08, 2024 8:15 pm. I re-read Bonds vs Bond Funds in the Wiki. I have some questions regarding the material authored by Annette Thau. 1. Thau has this quotation in her discussion of a bond ladder: "Moreover, if you don't reinvest the interest, you won't get the full annualized yield that made ...

  5. Buying treasuries

    Buying treasuries - Nominal or TIPS? I have 35% of our 3 fund portfolio in a 5 year Nominal Treasury Bond Ladder vs BND. I like the transparency of individual bonds. I want to make sure I understand TIPS as well as I understand nominal Bonds before I jump in. Based upon the comments here in the forum, I am considering expanding my ladder to ...

  6. TIPS vs Total Bond

    According to Portfolio Visualizer, since 1.2001, TIPS delivered 4.3% annually, while Total Bond, 3.5%. So, why is it preferable to use Total Bond in the 3 fund portfolio? dbr Posts: 45908 Joined: Sun Mar 04, 2007 2:50 pm Re: TIPS vs Total Bond by dbr » Sat Jun 03, 2023 2:08 pm

  7. TIPS vs. I Bonds tactics?

    TIPS vs. I Bonds tactics? by finguy47 » Thu Apr 07, 2022 4:03 pm Given the current environment (financial/Fed, global tensions, domestic politics, interest rates/inflation fighting, etc.), which of these scenarios will yield me the most money (on a percentage basis) after 6 years? I am in the 12% tax bracket. 1.

  8. Replace entire bond allocation with TIPS?

    Replace entire bond allocation with TIPS? by barnaby444 » Wed Jun 22, 2022 2:36 pm My portfolio is about 85% stocks / 15% bonds & cash. I've obviously taken a major hit in 2022. I am not about to panic sell, but I admit I'm pretty discouraged by the double-whammy of the bear market and relentless inflation.

  9. Should everyone have TIPS?

    TIPS, while not perfect, are a more direct link to the unexpected changes in inflation. If inflation rises and remains active for many years, some might be glad they held a TIPS fund. Could a long-term portfolio in the accumulation phase benefit from having say 50% of the bond portion invested in TIPS? dbr Posts: 45938

  10. Diversification: International Bond Fund, TIPS and ...

    Bogleheads' Guide to Investing refers to bond/stock/cash, but asset allocation only discusses bond vs. stock. I am curious to understand how does the allocation for cash factor in the overall stock/bond allocation, and what is considered cash (TIPS, US Savings Bonds, CDs, High Yield Savings Account, etc..., what about 4-weeks T-Bills)?

  11. TIPS Versus I Bonds

    Nov 1, 2023 When investors think about adding explicit inflation protection to their portfolios, Treasury Inflation-Protected Securities, or TIPS, are usually top of mind, as it's easy to...

  12. What is your favorite bond fund for the 3 fund ...

    A survey of stock vs. bond allocation is going to result in every amount from 0% Stock/100% bond to 100% Stock/0% bond. ... Perhaps 15% long-term TIPS, 10% muni bonds, and 5% long-term nominals, who knows. Your answers will be different. ... ↳ The Bogleheads® Wiki: a collaborative work of the Bogleheads community; ↳ Canada - finiki (wiki)

  13. TIPS vs IBonds (h/t Tipswatch) : r/Bogleheads

    TIPS vs IBonds (h/t Tipswatch) David Enna at Tipswatch offers an i nteresting comparison of TIPS vs IBonds based on current yields. As a Boglehead, what does the hive mind think about the approach of laddering TIPS with a plan to hold to maturity vs holding a bond fund such as BND? Archived post.

  14. Why Use I Bonds Instead of TIPS?

    It's true that, like TIPS, I Bonds are debt instruments issued by the federal government that offer a certain after-inflation return — as opposed to most bonds (i.e., "nominal" bonds), which offer a certain before-inflation return. But there are meaningful differences as well. No Interest Rate Risk

  15. Risks and disadvantages of a TIPs fund vs a regular bonds fund

    TIPS usually trade at a premium to a nominal bond: this difference is the market's inflation expectation. For example, if you compare VTIP and VGSH, the 30-day SEC yields are -2.5% (real) and 0.2% (nominal), so the market is pricing in an inflation expectation of 2.7%.

  16. ELI5: I-Bonds vs TIPS funds : r/Bogleheads

    17 FlarkinFlerken • 1 yr. ago • Edited 1 yr. ago Let me restate how I understood what you're saying. Assuming the inflation of 8%, $100 in either TIPS or I-Bonds pay $8. However, since TIPS are purchased on the secondary market, I am probably buying the $100 in TIPS for $102, so the yield I'm seeing is lower than inflation.

  17. TIPS vs I-Bonds vs Inflation protected mutual funds : r/Bogleheads

    TIPS vs I-Bonds vs Inflation protected mutual funds I've just become a Boglehead and I love the philosophy. I am starting to reallocate my investment accounts to fall in line with the Boglehead investment philosophy. As I begin reallocating, I certainly need to start adding bonds.

  18. TIPS vs. Nominal Treasury Bonds

    TIPS (Treasury Inflation-Protected Securities) are US government bonds that provide a specific after -inflation return (i.e., "real return") as compared to traditional "nominal" bonds which provide a specific before -inflation return. We've discussed before when it makes sense to use individual TIPS as opposed to TIPS funds.

  19. TIPS vs total bond market in 3 fund lazy portfolio : r/Bogleheads

    TIPS vs total bond market in 3 fund lazy portfolio : r/Bogleheads by SLKNLA TIPS vs total bond market in 3 fund lazy portfolio I was reading the section on three-fund lazy portfolios here and wondering about the relative merits of TIPS or total bond market for the bond component of the portfolio.

  20. TIPS vs I-Bonds

    What are Treasury inflation-protected securities (TIPS)? Treasury inflation-protected securities ( TIPS) are designed to provide inflation protection. They are sold as five, 10 or 30 year...

  21. TIPS vs I-Bonds: How Do TIPS Protect Against Inflation? And How Are

    WATCH our video explaining how I-Bonds work at https://youtu.be/efDIvlbgwDoTIPS are issued by the US Treasury and are indexed to inflation in order to protec...

  22. TIPS vs. Nominal Bonds for FIRE : r/Bogleheads

    Bogleheads are passive investors who follow Jack Bogle's simple but powerful message to diversify and let compounding grow wealth. Jack founded Vanguard and pioneered indexed mutual funds. His work has since inspired others to get the most out of their long-term stock and bond investments by indexing.

  23. Swedroe: TIPS Vs Nominal Bonds

    As of this writing, Aug, 14, 2018, the five-year TIPS was yielding 0.77% and the five-year nominal Treasury was yielding 2.76%. Thus, the breakeven inflation rate was 1.99%. That doesn't mean,...