From 24/7 Wall St. · Ryne Mauck · · 1m 10s
You Are 68 and a $40,000 Expense Lands in Three Years
Three Treasury ETFs protect $40,000 for a 68-year-old's fixed expense due in three years.
In brief
Three Treasury ETFs protect $40,000 for a 68-year-old's fixed expense due in three years. Three Treasury ETFs: BILS for short-term stability, VGSH for three-year horizon, STIP for inflation protection. Originally reported by 24/7 Wall St..
Fixed Expense Deadline
A 68-year-old faces a $40,000 expense due in three years.
Three Treasury ETFs Match This Need
State Street SPDR Bloomberg 3-12 Month T-Bill ETF (BILS), Vanguard Short-Term Treasury ETF (VGSH), and iShares 0-5 Year TIPS Bond ETF (STIP) suit this scenario.
Why Short-Term Treasuries Work
Short-term Treasuries remove credit risk and keep rate sensitivity low for fixed expenses.
Current Yields for Short Treasuries
The 3-month Treasury yielded 4.28% and the 3-year yielded 4.92% as of October 14.
BILS: Short-Term Stability
BILS tracks Treasury obligations with 3-12 month maturities and averages 4.49% yield.
VGSH: Three-Year Horizon
VGSH holds Treasuries maturing in 1-3 years with 0.03% expense ratio and 4.82% yield.
STIP: Inflation Protection
STIP covers inflation with 5-year real yield of 2.64% and principal tied to CPI.
The essence
Three Treasury ETFs: BILS for short-term stability, VGSH for three-year horizon, STIP for inflation protection.
