A common question we receive from customers is:

“I’ve built a TIPS ladder. How should I model it in MaxiFi?”

The answer depends on what you’re trying to accomplish. In most cases, the simplest approach is also the one we recommend, but read below for some differing approaches. 

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First, it’s helpful to understand what MaxiFi is designed to model. MaxiFi is a financial planning tool, not an investment management tool.

The software optimizes:

  • Your lifetime spending plan
  • Which accounts to withdraw from
  • Taxes
  • Roth conversions
  • Social Security claiming
  • Lifetime cash flow

MaxiFi does not model the individual investments held within your accounts. For example, the software doesn’t distinguish whether your IRA contains:

  • Stocks
  • Mutual funds
  • ETFs
  • CDs
  • Individual Treasury bonds
  • A TIPS ladder

Instead, it models the overall value of the account and determines how much should be withdrawn over time.

Option 1 (Recommended): Treat Your TIPS Ladder as Part of Your Portfolio

For most households, this is the simplest and recommended approach.

  • Enter the current value of the account that contains your TIPS ladder.
  • Update the account balance periodically (typically each year).
  • Continue using MaxiFi’s default Safe Rate of Return assumptions unless you have a specific reason to customize them.

Although the value of an individual TIPS bond may fluctuate before maturity, those changes are generally reflected in your account value. Meanwhile, MaxiFi’s default safe return assumptions are based on long-term Treasury and TIPS yields, helping keep the overall plan aligned with changing market conditions.

This approach allows MaxiFi to optimize your spending plan without requiring you to model every bond maturity individually.

Option 2: Model the Ladder as an Annuity

Some users build a TIPS ladder to create a predictable stream of annual cash flow. If your goal is to represent that predictable income directly within MaxiFi, you may choose to model the ladder as an annuity. Before doing so, keep these considerations in mind:

  • Remove the amount used to purchase the ladder from the corresponding investment account to avoid double-counting your assets.
  • This method works best when the ladder produces relatively predictable annual payments.
  • If your ladder is held in a taxable account, this approach will not perfectly model the tax treatment of TIPS, so it should be viewed as an approximation rather than an exact representation.

For many users, this approach provides a reasonable way to visualize expected income without tracking every individual bond.

Option 3: Use Special Receipts

If you know the exact years and amounts your ladder will produce, another option is to enter those cash flows as Special Receipts. This approach offers the greatest flexibility but also requires the most maintenance.

Keep in mind:

  • Actual inflation will differ from the planning assumptions over time.
  • As a result, you’ll likely need to revisit and update these entries periodically to maintain accuracy.

For most users, the additional maintenance isn’t necessary unless modeling those exact cash flows is particularly important to their planning process.

Which Option Should I Choose?

Your Goal

Recommended Approach

I want the simplest, most accurate planning model.

Treat the TIPS ladder as part of your investment portfolio.

I want to represent a predictable stream of income.

Model the ladder as an annuity.

I want to model each planned cash flow individually.

Use Special Receipts.

Frequently Asked Questions

Why doesn’t MaxiFi track my individual bond maturities?

MaxiFi is designed to optimize your financial plan—not your investment implementation. It determines how much should be withdrawn from each account, while leaving decisions about which specific securities to sell or hold to your investment strategy.

Should I update my TIPS ladder every time a bond matures?

Not usually. For most users, updating your account balances periodically is sufficient. There’s generally no need to enter each bond maturity individually unless you’re intentionally modeling those cash flows.

Should I change MaxiFi’s Safe Rate of Return because I own a TIPS ladder?

Usually not. MaxiFi’s default assumptions are already based on long-term Treasury and TIPS yields. For most households, those assumptions provide a very good approximation without requiring additional customization.