Forbes Urges Retirees to Buy TIPS as 2056 Real Yields Reach 2.7%

3 articles · Updated · Forbes · Jun 6

A 2056 Treasury Inflation-Protected Security now yields 2.7% above inflation, near historic highs, giving retirees a stronger case to use TIPS as the stable core of a balanced portfolio.
That bond beats a standard 2056 Treasury yielding 5% if inflation averages at least 2.3% over 30 years; the latest CPI reading showed a 3.8% annual increase.
TIPS still carry interest-rate risk—prices fell with other Treasuries in 2022 when real rates rose—and a remote default or payment-delay risk tied to U.S. fiscal strains and debt-limit standoffs.
Investors can buy at monthly Treasury auctions or in the secondary market, where June yields ranged from 0.9% for near-term maturities to about 2.7% for bonds due 2048 and later.
For smaller allocations, Forbes points to low-cost TIPS funds charging as little as 0.03%, while direct buyers with at least $100,000 can keep trading costs lower by holding individual bonds to maturity.