What Are TIPS? | CNBC?

TIPS are like special piggy banks that grow when prices go up, and they help protect your money from getting smaller when everything else gets more expensive.

Imagine you save $100 in a TIP piggy bank. If the cost of toys, candy, and ice cream goes up (which means inflation happens), your piggy bank will give you extra money to keep up with those prices. That way, even though things are more expensive, your piggy bank still feels full.

TIPS stand for Treasury Inflation-Protected Securities, which is just a fancy name for these special piggy banks made by the government. Every year, the amount of money in the piggy bank gets adjusted based on how much prices have gone up, it’s like getting a little bonus if things get more expensive.

When you’re ready to take your money out, you get both the original amount and all the extra bonuses from the years you saved. It's like having a piggy bank that grows smarter as time goes on! TIPS are like special piggy banks that grow when prices go up, and they help protect your money from getting smaller when everything else gets more expensive.

Imagine you save $100 in a TIP piggy bank. If the cost of toys, candy, and ice cream goes up (which means inflation happens), your piggy bank will give you extra money to keep up with those prices. That way, even though things are more expensive, your piggy bank still feels full.