Investing - Theory, News & General • Re: How to extend tips ladder

I have a rolling 10-year ladder to offset contingent increases in retirement spending (e.g., early LTC). For now, I'm going to roll over the proceeds from completed year (e.g., early 2027 maturing plus coupons since last roll) into new 10-year (e.g., 2037 bonds). This will make the ladder lumpy, but think it will good lumpy, or good enough lumpy, at least for now.

I didn't model it out, and am not am not among the TIPS experts, but here is how I thought it might work. First, it will increase the payout over the next nine years -- not a problem in and of itself. Second, unless market real yields are negative or near zero, the new rung at time of purchase should be about the same size as the maturing rung (counting recent coupons). Third, even if it is less, by the time the new rung matures, that year's proceeds will include coupons clipped from the bonds for the next nine years into which we will roll later. Those coupon proceeds could be very low, if those nine years had very low coupons (minimum 0.125%/year, I think), so there is some potential for a weak rung, but it seems like the sort of thing would could fix over that time or live with. And if it happens to be higher, that is not a problem. Finally, there is some lumpiness due to the fact that one usually buys TIPS in $1000 face multiples.

I didn't quite follow what you meant by "create as big a tips ladder as I can upfront". Do you mean that you if really want to minimize lumpiness for a long period, like 15 years, you would consider buying a 15 year ladder up front instead a 10 year that you roll for a few years? That is a very apples to oranges comparison, and depends on how strongly you prefer apples to oranges.

Statistics: Posted by ncdcpa — Fri Sep 25, 2026 9:21 am