Agreed. While I am not ready to jump on longer term TIPS (a decision I may regret), a rolling 5-year ladder of TIPS is letting me sleep easier.A hefty balance in a MMF is a nice security blanket, but it's no substitute for a real long-term investment plan. As others have noted, there's no guarantee those sweet-looking returns won't go south in a hurry.
I'm in the process of moving most of my fixed income portfolio to TIPS, which as of a month ago were offering a guaranteed long-term rate of 2.25 above CPI. Do the arithmetic and you'll find the current MMF return isn't far from that - but it comes with no guarantees.
Despite the determination that so many people display that interest rates (and inflation) will go down, I don't see anything that validates that assumption. Of course, my assumptions on interest rate movements have been so incorrect that I no longer have any faith in my abilities to read the tea leaves.
Statistics: Posted by Richard1580 — Sun May 05, 2024 9:13 pm — Replies 95 — Views 11126
