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papadad111 · 10-08-2014, 11:58 PM

Saw this article. interesting. But...I thought there was a limit to how many TIPS can be purchased by anyone in a calendar year...

Three Ways to Get a Steady Paycheck Long After You've Retired - Bloomberg

The lowest-risk way retirees can create lifetime income is to put around 85 percent of their savings in TIPS, says Stephen Sexauer, chief investment officer of U.S. multi-asset management at Allianz Global Investors.

To show how much money you'd need to invest in order to get the income you want from TIPS, Sexauer and Siegel created a website, DCDBBenchmark.com. It provides a table of current payouts for $100,000 invested in the 85 percent TIPS/15 percent deferred annuity strategy.

eta2020 · 10-09-2014, 04:48 AM

Yes TIPS are safe but they have more less no after inflation return. If I get 0.35% plus inflation and all of this is TAXABLE I end up with shrinking portfolio even if I don't withdraw anything from it.

Maybe when rates go up TIPS will be attractive. BTW TIPS are exposed to decline due to rising rates just as other government bonds are.

So 85% of portfolio in TIPS is disaster

marko · 10-09-2014, 06:12 AM

There's a difference between a 'lifetime income' and a useful lifetime income. Getting a guaranteed income is nice...but it needs to return more than gas money.

Bloomberg Surveillance Radio did an interview just yesterday morning on TIPS and the guest more or less said that with the current rate of inflation and TIPS yields, it is not a good investment at this time.

Totoro · 10-09-2014, 06:16 AM

Quote:

Originally Posted by papadad111

The lowest-risk way retirees can create lifetime income is to put around 85 percent of their savings in TIPS, says Stephen Sexauer, chief investment officer of U.S. multi-asset management at Allianz Global Investors.

Stephen Sexauer should be fired. The lowest volatility way for a lifetime income certainly is TIPS. But risk does not equal volatility.