Treasury Inflation-Protected Securities (TIPS) are a type of government bond designed to protect investors from inflation. The principal value of TIPS increases with inflation and decreases with deflation, ensuring that the investment retains its purchasing power over time. Interest payments are made every six months and are based on the adjusted principal, meaning they can vary as inflation changes. Investors often choose TIPS as a safe investment option, especially during periods of rising prices. They are backed by the full faith and credit of the U.S. government, making them a low-risk choice for those looking to preserve their capital while earning interest.