$1000 Invested In 1971 at 5 percent is worth less today according to the U.S. Treasury

For $1000 to have the same intrinsic worth as it did in 1971 it would now have to equal $5,517.00 according to the U.S. Bureau of Labor Statistics. Now suppose someone put $1000.00 into a Treasury Bond in 1971 at a 5 percent interest rate and also pays income tax of 28 percent after redemption. That $1000.00 bond would now be worth $5,470.89 according to the U.S. Treasury. 

Th problem is that is even less than the amount of money required to maintain the value from 1971, $46.11 less to be exact. Conclusion, anything lower than 5 percent is insufficient to build suitable retirement due to inflation. It is for this reason, specific investments such as Treasury Inflation Protection Securities or TIPS are bought to provide inflation protection.