Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
TSP G Fund
Old 04-09-2015, 07:53 AM   #1
Recycles dryer sheets
 
Join Date: Nov 2005
Posts: 152
TSP G Fund

Hello All,

I have a quick question regarding my portfolio. Currently 65% of it is taxable and the rest is in the TSP and a Roth IRA. My bond allocation is at 22% and the majority of it is in Vanguard Total Bond ETF (BND). At the moment I have the same allocation in each account instead of having bonds only in a Roth or TSP. Originally my thinking was that it was better to allow tax free accounts to grow on par with my taxable accounts.

In our current interest rate environment would you move your bond allocation exclusively to the TSP G fund? When interest rates rise this fund should do really well.
__________________

__________________
trixs is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 04-09-2015, 08:14 AM   #2
Thinks s/he gets paid by the post
timo2's Avatar
 
Join Date: Jul 2011
Location: Rio Rancho
Posts: 1,438
That is what I did, after some research "The way the interest rate is calculated on the G Fund, along with the Board’s policy of investing exclusively in short-term maturities, gives TSP investors the advantage long-term rates paid on Treasury notes for short-term securities" Understanding the TSP’s G Fund : FedSmith.com

Although the G fund has attracted some unwanted attention lately "Those recommendations include aligning the G Fund “with an appropriate risk profile,” according to the committee report on the concurrent resolution, which the House passed on March 25." Congress Doesn’t Have Appetite For Messing with the G Fund, Senator Says - Pay & Benefits - GovExec.com
__________________

__________________
"We live the lives we lead because of the thoughts we think" Michael O’Neill
timo2 is offline   Reply With Quote
Old 04-09-2015, 08:26 AM   #3
Recycles dryer sheets
 
Join Date: Nov 2005
Posts: 152
I did not know that. The change would make the G fund all but useless. If that was passed I suppose we could always just reallocate the portfolio again.
__________________
trixs is offline   Reply With Quote
Old 04-09-2015, 09:17 AM   #4
Thinks s/he gets paid by the post
timo2's Avatar
 
Join Date: Jul 2011
Location: Rio Rancho
Posts: 1,438
Quote:
Originally Posted by trixs View Post
I did not know that. The change would make the G fund all but useless. If that was passed I suppose we could always just reallocate the portfolio again.
We could reallocate if and when that ever happened. It would not be overnight. It is hard to figure why they would mess with it, but politics is beyond the scope of this forum.
__________________
"We live the lives we lead because of the thoughts we think" Michael O’Neill
timo2 is offline   Reply With Quote
Old 04-09-2015, 10:11 AM   #5
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
donheff's Avatar
 
Join Date: Feb 2006
Location: Washington, DC
Posts: 8,641
My TSP is entirely in the G Fund. It is a minor part of our portfolio and comprises a bond portion and, simultaneously, a cash reserve since it can't lose absolute value.
__________________
Every man is, or hopes to be, an Idler. -- Samuel Johnson
donheff is online now   Reply With Quote
Old 04-09-2015, 10:45 AM   #6
Administrator
W2R's Avatar
 
Join Date: Jan 2007
Location: New Orleans
Posts: 38,846
Quote:
Originally Posted by donheff View Post
My TSP is entirely in the G Fund.
+1, mine too. The rest of my bond allocation is in taxable accounts at Vanguard. Access to the G Fund is a major part of our benefits package as federal employees/retirees.

I am retired, and I am receiving equal monthly payments from the TSP. G Fund shares cannot decrease in price without an act of Congress. So, for me this simulates an additional pension, to supplement my (tiny) FERS pension.

They have been talking about changing G Fund risk for decades, just like they have been talking about changing federal pension/annuity computations to high-5 instead of high-3. These bills/proposals give politicians brownie points with non-feds but they never seem to go anywhere. I see no reason to get excessively upset about it until the time if/when there are changes in place. If G Fund radically changes or disappears, there's always F Fund.
__________________
Already we are boldly launched upon the deep; but soon we shall be lost in its unshored, harbourless immensities.

- - H. Melville, 1851
W2R is offline   Reply With Quote
Old 04-09-2015, 11:49 AM   #7
Dryer sheet aficionado
 
Join Date: Apr 2015
Location: South Texas
Posts: 28
Except the fact that a new budget proposal slashes the returns form this fund and renders it nearly useless.



http://www.fedsmith.com/2015/03/24/w...nterest-rates/

Marco
__________________
Marco is offline   Reply With Quote
Old 04-09-2015, 04:15 PM   #8
Thinks s/he gets paid by the post
timo2's Avatar
 
Join Date: Jul 2011
Location: Rio Rancho
Posts: 1,438
More on the G fund proposal issue from Tammy Flanagan
Don’t Mess With the G Fund - Retirement Planning - Pay & Benefits - GovExec.com
__________________
"We live the lives we lead because of the thoughts we think" Michael O’Neill
timo2 is offline   Reply With Quote
Old 04-09-2015, 06:53 PM   #9
Thinks s/he gets paid by the post
martyb's Avatar
 
Join Date: Nov 2006
Location: Bossier City
Posts: 2,182
I'm a retired fed, CSRS, for 9 1/2 months now. I recently reallocated my TSP account to 30/30/40 C/S/F. I haven't begun taking withdrawals yet.

Sent from my SAMSUNG-SM-G900A using Early Retirement Forum mobile app
__________________
“Change is the law of life. And those who look only to the past or present are certain to miss the future.”
-John F. Kennedy

“Hard work never killed anybody, but why take a chance?” - Edgar Bergen
martyb is online now   Reply With Quote
Old 04-10-2015, 08:42 AM   #10
Thinks s/he gets paid by the post
nash031's Avatar
 
Join Date: Jun 2013
Location: Coronado
Posts: 1,486
Quote:
Originally Posted by trixs View Post
In our current interest rate environment would you move your bond allocation exclusively to the TSP G fund? When interest rates rise this fund should do really well.
Regardless of interest rate environment, this is exactly what I do.
__________________
"So we beat to our own drummer in the sun;
We ask for nobody's permission to run.
I just wanna live in a world like that;
Now I'm gonna live in a world like that!" - World Like That, O.A.R.
nash031 is offline   Reply With Quote
Old 07-17-2015, 11:08 AM   #11
Thinks s/he gets paid by the post
timo2's Avatar
 
Join Date: Jul 2011
Location: Rio Rancho
Posts: 1,438
Something new to pay attention to regarding using the G fund to fund the highway bill.

"But Hatch also said that about $30 billion worth of the Senate offsets — enough to fill the highway gap for maybe two years — would come out of the retirement program for federal employees."

There is some concern that this move may decrease the rate of return.

Senate GOP brushes aside House highway bill | TheHill
__________________
"We live the lives we lead because of the thoughts we think" Michael O’Neill
timo2 is offline   Reply With Quote
Old 07-17-2015, 04:51 PM   #12
Full time employment: Posting here.
Dog's Avatar
 
Join Date: Apr 2006
Posts: 781
DH is planning to move his TSP funds to G fund when her retires next May and just tapping into the interest it generates of the balance as another source of income to add to his smallish FERS. I guess it will depend on what happens to the fund.
__________________
"Tell me, what is it you plan to do with your one wild and precious life?" - Mary Oliver
Dog is offline   Reply With Quote
Old 07-17-2015, 07:04 PM   #13
Thinks s/he gets paid by the post
martyb's Avatar
 
Join Date: Nov 2006
Location: Bossier City
Posts: 2,182
Still haven't started TSP withdrawals yet, but I have reallocated to 50% S, 25% C & 25% G funds. I'm contemplating my withdrawal strategy.....

Sent from my SAMSUNG-SM-G900A using Early Retirement Forum mobile app
__________________
“Change is the law of life. And those who look only to the past or present are certain to miss the future.”
-John F. Kennedy

“Hard work never killed anybody, but why take a chance?” - Edgar Bergen
martyb is online now   Reply With Quote
Old 07-18-2015, 06:01 AM   #14
Recycles dryer sheets
kitesurfer2's Avatar
 
Join Date: Nov 2014
Location: jax
Posts: 229
i have 50% in L2050, 25% in C, and 25% in S. Thinking of moving my 2050 to 2020. G fund will preserve assets but they won't grow much.
__________________
kitesurfer2 is offline   Reply With Quote
0% in G
Old 07-18-2015, 10:49 PM   #15
Recycles dryer sheets
 
Join Date: Mar 2013
Location: San Antonio
Posts: 121
0% in G

Slightly different take than most on the utility of the G fund and bonds in general based on my situation.

I'm considering my active duty retirement as the bond component of my portfolio (when I retire). This "guaranteed" income will cover most of my retirement needs, so I am very comfortable investing the majority of my money in stocks, and the TSP C and S funds.

Does anyone else share this method of thinking?

Am I missing something and selling myself short by not taking advantage of the G fund?
__________________
haloFIRE is offline   Reply With Quote
Old 07-19-2015, 01:01 AM   #16
Thinks s/he gets paid by the post
nash031's Avatar
 
Join Date: Jun 2013
Location: Coronado
Posts: 1,486
Quote:
Originally Posted by haloFIRE View Post
Slightly different take than most on the utility of the G fund and bonds in general based on my situation.



I'm considering my active duty retirement as the bond component of my portfolio (when I retire). This "guaranteed" income will cover most of my retirement needs, so I am very comfortable investing the majority of my money in stocks, and the TSP C and S funds.



Does anyone else share this method of thinking?

No, that's largely what Nords recommends in his book, and pretty much what I do. We are 85/15, however, but probably won't dip below that. The 15 is almost entirely G.
__________________
"So we beat to our own drummer in the sun;
We ask for nobody's permission to run.
I just wanna live in a world like that;
Now I'm gonna live in a world like that!" - World Like That, O.A.R.
nash031 is offline   Reply With Quote
Old 07-19-2015, 06:44 AM   #17
Recycles dryer sheets
 
Join Date: Aug 2014
Posts: 54
Quote:
Originally Posted by kitesurfer2 View Post
i have 50% in L2050, 25% in C, and 25% in S. Thinking of moving my 2050 to 2020. G fund will preserve assets but they won't grow much.

Doesn't this mess up your allocation? I've always thought you either do the lifestyle funds 100% or not at all and create your own allocation. By breaking it up, you're defeating the whole purpose of the lifestyle funds.


Sent from my iPad using Early Retirement Forum
__________________
surferLife is offline   Reply With Quote
Old 07-19-2015, 07:13 AM   #18
Recycles dryer sheets
kitesurfer2's Avatar
 
Join Date: Nov 2014
Location: jax
Posts: 229
yea, i just mixed it up a little. my annuities are lifetime and exceeds my normal living expenses by a couple thousand per month. So since i technically don't 'need' this money i can afford to risk it a little. the other hand says play it safe with a modest 3% per year. the problem with TSP is the lag time in processing changes. I will be moving distributions as soon as the S%P bumps up a little more. at heart, I'm a sock it away and forget about it kind of guy.
__________________
kitesurfer2 is offline   Reply With Quote
Old 07-25-2015, 11:35 PM   #19
Moderator Emeritus
Nords's Avatar
 
Join Date: Dec 2002
Location: Oahu
Posts: 26,616
Quote:
Originally Posted by haloFIRE View Post
Slightly different take than most on the utility of the G fund and bonds in general based on my situation.

I'm considering my active duty retirement as the bond component of my portfolio (when I retire). This "guaranteed" income will cover most of my retirement needs, so I am very comfortable investing the majority of my money in stocks, and the TSP C and S funds.

Does anyone else share this method of thinking?

Am I missing something and selling myself short by not taking advantage of the G fund?
Like Nash says, you're good.

The G fund is useful for people who aren't getting a military pension, like veterans. I guess that could also be said for federal civil-service employees who left for industry.
__________________

__________________
*
*

The book written on E-R.org, "The Military Guide to Financial Independence and Retirement", on sale now! For more info see "About Me" in my profile.
I don't spend much time here anymore, so please send me a PM. Thanks.
Nords is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
TSP Fund Allocation Purron FIRE and Money 8 11-05-2010 04:03 PM
Bonds, TSP G Fund WM FIRE and Money 9 05-24-2008 11:08 AM
TSP Fund Distribution guest FIRE and Money 10 01-14-2008 07:40 PM
TSP S-Fund: What sector is the DJW4500? AV8 FIRE and Money 6 02-03-2007 08:58 PM
Think Tank Blasts TSP Real Estate Fund Proposal hellbender FIRE and Money 14 07-20-2006 08:45 AM

 

 
All times are GMT -6. The time now is 07:26 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.