About all I know about TIPS is that they are some semi low risk Treasury bill type investment that is linked to the inflation rate. LOL...Pretty horrid explanation I know.
Up until this year I was 100% invested in stocks but now with 6.5 years to go until retirement (maybe 7.5 years now) I have 60% stocks / 15% bonds / 10% TIPs / 15% Real Estate.
Now I know putting 10% of my money in TIPS without understanding them is pretty foolish....hence my question now. Better late than never.
Anyone willing to give me a quick explanation of what they are exactly, and what purpose they serve to a portfolio so I can figure out if I really want to keep them? More specifically, is there any benefit to having 10% TIPS as oppossed to that 10% being in bonds of some sort?
Currently my 15% bonds is in PTRAX and the 10% TIPS is in VIPSX
Up until this year I was 100% invested in stocks but now with 6.5 years to go until retirement (maybe 7.5 years now) I have 60% stocks / 15% bonds / 10% TIPs / 15% Real Estate.
Now I know putting 10% of my money in TIPS without understanding them is pretty foolish....hence my question now. Better late than never.
Anyone willing to give me a quick explanation of what they are exactly, and what purpose they serve to a portfolio so I can figure out if I really want to keep them? More specifically, is there any benefit to having 10% TIPS as oppossed to that 10% being in bonds of some sort?
Currently my 15% bonds is in PTRAX and the 10% TIPS is in VIPSX