Currently short dated TIPS are not exactly exciting but maybe a better alternative then nominal bonds?
Here are some current numbers focusing on 2 to 3 years:
1) 3.3 year TIPS are at about 0.32%
2) Vanguard short term inflation protected (VTAPX) is at 0.28% SEC yield (2.3 year duration, ER=0.1%)
3) 3 year brokered CD is at 1.75%
Energy prices have been on a strong downtrend this year as everyone knows. Might they stabilize or even go up? It has happened before. Here is a chart of 2 measures of cpi. The Fed is reported to target the one without energy and food (blue line). The red line on the chart is the "headline" inflation data.
I'm thinking with the Fed at least jawboning about rate increases and inflation kind of looking a little dodgy to me, maybe buying some short term insurance would be a good deal.
By buying TIPS directly (#1 above) and holding to maturity, one could at least get some real return on their money.