[lotsofpulp]

Broad market index funds are the inflation protected asset due to US federal government bailout. Your savings account is not going to keep up with inflation, nor are TIPS or US treasuries (not for land/healthcare/education), but an SP500 fund will do a better job over the course of decades.

[Dalewyn]

TIPS are literally designed to track inflation, Treasury I-Bonds are also designed to track and surpass inflation.

The US total stock market (ex-US stock market is a crapshoot) and its subset the S&P 500 index will generally do a better job than any bonds given a long enough timeframe, but that doesn't mean appropriate bonds can't do the job either.

[lotsofpulp]

That is why I specified land/healthcare/education. I guess I should have specified that it matters more for metropolitan areas, especially high cost of living regions.

TIPS won’t come close to making one be able to compete with other buyers in those markets for the non mass produced/imported resources.

If someone invested their money in TIPS over the last 30 or 40 years thinking they will be able to buy real estate because TIPS protected them from inflation, they would have been sorely disappointed for pretty much all non Midwest/interior northeast metros.

This is a demographic/political issue for all developed countries, they must reduce the purchasing power of their currency as a tax to be able to deliver the benefits expected by the more populous, older voting populace.

[ac29]

> If someone invested their money in TIPS over the last 30 or 40 years thinking they will be able to buy real estate because TIPS protected them from inflation

TIPS have been available less than 30 years.

[lotsofpulp]

Does that change the reality that a 1997 30 year TIPS would have been ineffective at helping purchase what was once a below $100 per square foot home in 1997 that is now $300+ per square foot in most US population centers?

Replace home price change (or land price change) with education price change or healthcare price change. Probably even trades’ worker price change.

If a nursing home cost $x per month in 1997, and you thought putting away an equivalent amount of cash in TIPS will ensure you can afford a nursing home in 2027 or 2037, it’s probably not going to be fun to find out how much they cost now.

It worked great if you wanted to ensure being able to buy electronics, other manufactured goods, and probably groceries. But those are beneficiaries of automation and foreign labor.

[ac29]

If you want to make an argument about inflation metrics being wrong, feel free to show your data and math.

Claims that inflation adjusted bonds don't actually track (average) inflation need evidence.

[lotsofpulp]

https://www.ishares.com/us/products/239467/ishares-tips-bond...

3.6% annual return since Dec 2003. 1.036^20=2.0286.

Home prices have more than doubled since then, for a large portion of the US. Source for that is going to Zillow, searching a home in a major metro, and looking at price history.