Investing - Theory, News & General • Re: Building a TIPS ladder for IRA RMDs

My IRA is entirely in TIPS and, at least initially, annual cash flow once RMDs start should exceed RMDs. The current plan is to leave the excess in the IRA, although I haven't decided how to invest the excess. Perhaps at least some portion in a short TIPS fund in case I need to withdraw the money, but I wonder if others have a similar issue and what they're doing.

Correct - if your TIPS is in the form of a normal ladder, normal cash flow should pretty much always exceed RMDs. My own analysis shows that it would take a world record drop in yields before RMDs would exceed what the ladder throws off on its own. Even then, it would probably be temporary as the effective withdrawal rate from a TIPS ladder climbs much faster over time than the effective withdrawal rate due to RMDs.

Anyway, your basic question is a great one. Right now, for the same reason as you, we're throttling back a little on our withdrawals from our TIRAs. Any excess we have is used to purchase stock which we are also in the process of Roth converting. Purchasing more stock will just mean we'll have more to Roth convert over time. But I think there will come a day when there's nothing left to convert, except just the excess, assuming that there is always an excess, and that probably won't be worth bothering with - just depends on what things look like when we get there.

Options we might think about when we get there
- Purchase more of the ultrashort term TIPS funds we already have (ICPI and RBIL)
- Continue to purchase stock with the excess but don't Roth convert.
- Continue to purchase stock, but continue to Roth convert, if it makes sense.
- QCD the excess.
- The other one is one that we might have to think about more in advance. Today, I'm keeping track of the cost of purchasing a supplemental TIPS ladder that I would use to augment our SS, should a cut come to pass in the percentage of shortfall and year thereof that's reported by OASDI each year. The purchase of it would come from sale of stock in one of our TIRAs, and that has repercussions for our Roth conversion plan as well as having to think more about what to do with excess. It's a more complicated thing to consider, but we're keeping that in the back of our minds as well.

Cheers.

Statistics: Posted by dcabler — Fri Aug 14, 2026 11:40 am