Tony Robbins suggests TIPS

[FIREarly]

On a LONG car ride, listened to some of Tony Robbins Money Mastery audiobook. Around ~Chap 8 or 9, TR talks about some ~$20 billion guy who puts 20% of his security funds in Treasury Inflation Protected Securities (TIPS). At the worst, you get your money back. This combined with a CD will be DW/DH security/safety fund.

This post is solely to discuss TIPS. Never bought them before and understand getting a VERY large and safe bank is the way to go because the first rule of investing is don't lose money.

What are some of the most well regarded TIPS to buy and what is their ticker symbol?

Feel like read somewhere here Credit Suisse (?)

PS The other half fell asleep during the audiobook

 

[Humbooster]

I am with the other half on this, TR would promote anything to promote himself.

 

[COcheesehead]

T o n y r o b b i n s ? You have got to be kidding.

I once went to a seminar where TR talked about how to lift weights.

 

[FIREarly]

Disregard where it was heard. What are your thoughts on TIPS?

 

[COcheesehead]

Disregard where it was heard. What are your thoughts on TIPS?

I don’t buy them.

 

[Alex The Great]

I don't have any TIPs because in a shorter time like 5-7 years CDs have better rates and beyond that I need to convert funds from tIRA as it could be a bigger problem later.

 

[njhowie]

If you are asking about ticker, I gather that you're looking for a TIPS mutual fund or ETF? They may not perform as TIPS do. Review threads discussing owning bonds vs. bond funds. TIPS are bonds. If you want a primer on TIPS, spend some time on tipswatch.com. They discuss TIPS in great detail, suggest which TIPS to buy, and which not to buy - TIPS, not TIPS funds

If you are looking for a TIPS fund, then just choose VAIPX since it has low(est) expenses, and be done.

Feel like read somewhere here Credit Suisse (?)

Not sure where you got the idea that TIPS had anything to do with banks, but they have absolutely nothing to do with banks. They are government "Treasury" securities. You can buy them on treasurydirect directly from the government or through your broker. As a side note Credit Suisse is not a safe bank.

 

[njhowie]

I don't have any TIPs because in a shorter time like 5-7 years CDs have better rates and beyond that I need to convert funds from tIRA as it could be a bigger problem later.

You don't know that CDs will have better returns unless your crystal ball is giving you a forecast of what inflation will be over the next 5 to 7 years that you lock in your CD rate for. Yes, it is highly likely that inflation will not be as high as it spiked last year, but you have absolutely no guarantee of that.

 

[FIREarly]

Great posts, thank you!

TIPS are new to me and learning.

 

[Alex The Great]

You don't know that CDs will have better returns unless your crystal ball is giving you a forecast of what inflation will be over the next 5 to 7 years that you lock in your CD rate for. Yes, it is highly likely that inflation will not be as high as it spiked last year, but you have absolutely no guarantee of that.

Indeed nobody can tell about inflation in future. But for 5 years ahead, it is unlikely that TIPs would outperform CDs even if inflation raise again. For 10-15 years, it could be a different story. I may consider TIPs as longer term investment only.

 

[Montecfo]

There is embedded insurance. That has a value.

One thing we learned last year is TIPS are highly rate sensitive. Why? Because they have low coupons. This means longer "duration" for a given term. Counterintuitive I think.

So something to keep in mind.

 

[aja8888]

You are aware that TIPS were paying 9.62% for 6 months last year and current prior 6 months are still paying 6.48%, aren't you?

If inflation does pick up again, TIPS could very easily outperform current issue CDs.

Understand, I'm not advocating for or against TIPS, just saying that the returns will be tied to inflation and nobody knows how that will play out.

Weren't those rate for I bonds, not tips?

 

[njhowie]

Weren't those rate for I bonds, not tipa?

Actually, you are correct - my mistake.