A Portfolio for Those Who Just Give Up

iShares Lehman Brothers TIPS Bond Fund(TIP Quote) -- 20%.

If you believe deflation is a big threat, or cannot forgive what certainly seems like the government's understating of inflation, this fund is not for you.

Over its history, it has been a fairly boring hold (which is the desired effect), paying out a variable stream of income to shareholders. The income varies because the consumer price index varies, and there have been months where there have been no payments.

The payout is comprised of the actual coupon payment plus the inflation adjustment (verified with a call to iShares). If you believe inflation (understated though it may be) will head higher then the payout from the fund should increase but it does change from month to month.

To be clear: the "I Give Up" portfolio is no substitute for a diversified portfolio for people who have normal tolerances for volatility -- but not everyone has a tolerance for the ups and downs of the stock market. This mix covers several bases with a reasonably long track record of decent returns with low volatility.

Anyone interested in pursuing this type of approach will lag the market when it is up a lot, and should plan on increasing their savings rate.