Thrift Savings Plan (TSP) Returns

[Purron]

Check out the latest returns on the TSP:
TSP Rates, Current Monthly Returns, 2008-03-03

I know I'm not the only one around here with a healthy hunk of change in the TSP. Just curious about how my fellow TSPers are handling this. I previously had my funds spread around between many of the funds but dumped in all in the G fund last October. I was just being [-]paranoid [/-]cautious since my retirement was only 3 months away. I'd like to diversify but frankly it all looks pretty gloomy.

 

[W2R]

The G-Fund yield was 4.66% for the past year (even though it was only 0.24% for February). Hopefully it will do better in March. Regardless, I am planning to retire in 612 days () so I am steadily moving into G and should be entirely there on the month when I retire.

The G Fund is a terrific benefit of being a federal employee. It provides rates similar to those of long term government securities but without any risk of loss of principal and with very little volatility of earnings. As such, I plan to keep my TSP in G-Fund as part of the fixed portion of my asset allocation. Actually, this is part of my financial plan and is not something that I am doing in response to the crummy market conditions lately.

The other funds are doing pretty badly! I am 56% G right now, but I still have 18% I and it KILLS me.

I have revised my estimate of how much my TSP will contain at the end of 2009, to about 90% of what I thought it would be. That is partly due to poor performance of all of the funds (which I think/hope will improve some), and partly due to moving into G from now on.

 

[Lakedog]

I'm retiring from the feds at the end of this month. My AA is about where I plan to stay (and TSP makes up about 40% of my investments). My TSP holdings are 45% G, 18% S, and 37% I, but this is just how the TSP allocations worked out to get my total portfolio (TSP, Roth, taxable) to the right AA. With a pension, I may even be too conservative so I am giving this some more thought.

 

[ziggy29]

Isn't it those of us *without* a big government pension who need to stress over the value of our retirement accounts?

 

[FinanceDude]

20 year of 6.57% return isn't that terrible.........although a low interest rate environment could depress those returns for awhile...........

 

[FinanceDude]

Isn't it those of us *without* a big government pension who need to stress over the value of our retirement accounts?

 

[W2R]

Isn't it those of us *without* a big government pension who need to stress over the value of our retirement accounts?

Big? BIG?

 

[Marquette]

Big? BIG?

I think it's how you read it. I parsed it like this:

Isn't it those of us *without* a [big government] pension who need to stress over the value of our retirement accounts?

And, you can't say it's not a big government

 

[Purron]

I am planning to retire in 612 days () so I am steadily moving into G and should be entirely there on the month when I retire.

612 days? I think we have a countdown here! It's interesting to note you are planning to gradually transition entirely to the G fund prior to your retirement. I'm inclined to leave my funds in the G fund, at least until the market stabilizes, but would be interested to hear what anyone else thinks about the TSP investment choices. While I do tend to be very risk adverse, I wonder if moving a modest amount into some of the other TSP funds might be worth considering.

 

[W2R]

I think it's how you read it. I parsed it like this:

Isn't it those of us *without* a [big government] pension who need to stress over the value of our retirement accounts?

And, you can't say it's not a big government

OOOooooh!!! So true. It's definitely a big government, but I wouldn't call my four figure pension gargantuan, even though it is kinda partly COLA'd.

On the other hand, I truly am grateful to have pension at all to supplement my smallish SS, for which I am also grateful. If I actually get SS, that is! I think I will.

 

[W2R]

612 days? I think we have a countdown here! It's interesting to note you are planning to gradually transition entirely to the G fund prior to your retirement. I'm inclined to leave my funds in the G fund, at least until the market stabilizes, but would be interested to hear what anyone else thinks about the TSP investment choices. While I do tend to be very risk adverse, I wonder if moving a modest amount into some of the other TSP funds might be worth considering.

Well, in my case I was invested mostly in the TSP equity funds during accumulation phase, because I wanted my TSP to grow and was willing to take that risk. But in retirement phase, most of my investments will be in my taxable account. I can put equity index funds there and be reasonably tax efficient, but I have only smaller tax advantaged accounts in which to position my fixed income for tax efficiency. So, it seems prudent to use my TSP entirely for fixed income. I may eventually roll it over, though I really do love that G Fund.

I am probably not the one to advise you about keeping it in G Fund or not, since I am thinking about it permanently myself. I would be inclined to suggest keeping it there, but then you might miss out on some really low priced S, I, and C. During 2000-2002, I kept a hefty portion of F, too, and it seemed to do pretty well during that difficult economic time.

You are right about the countdown! It is approximate but probably pretty close. I mark off another day every morning.

 

[jazz4cash]

Big? BIG?

Maybe Ziggy meant BIG Government as opposed to local Gov't?

 

[ziggy29]

Maybe Ziggy meant BIG Government as opposed to local Gov't?

So many different ways to parse it! Y'all can choose your interpretation.

 

[Nords]

I'm inclined to leave my funds in the G fund, at least until the market stabilizes, but would be interested to hear what anyone else thinks about the TSP investment choices. While I do tend to be very risk adverse, I wonder if moving a modest amount into some of the other TSP funds might be worth considering.

I retired too early for the TSP (a paltry $1800 that was kicked back before the ink dried on my DD-214) but we have spouse's TSP 100% in the "S" fund.

Spouse won't be facing TSP withdrawals until at least 2022, and then it'll only be as necessary for IRA rollovers & Roth conversions. If your money isn't going to be touched for 5-10 years then there's more than enough time to reinvest dividends and stage a comeback. If the volatility between "beginning" and "end" bothers you... well, then try not to look or else choose a much more conservative AA.

As for that "market stabilizes" comment... the stock market is the only store in the world where they roll out the blue-light specials and the customers run away screaming. Seigel in "The Future For Investors" says that much of an investment's compounded returns are due to reinvested dividends-- so you should plunk it down now in your chosen AA, keep DCA'ing as planned, and pray for the stock market to drop another 20% to turbocharge those reinvested dividends...

 

[rickier55]

612 days? I think we have a countdown here! It's interesting to note you are planning to gradually transition entirely to the G fund prior to your retirement. I'm inclined to leave my funds in the G fund, at least until the market stabilizes, but would be interested to hear what anyone else thinks about the TSP investment choices. While I do tend to be very risk adverse, I wonder if moving a modest amount into some of the other TSP funds might be worth considering.

I retired almost 3 years ago. I had 30% in G, 70% in C. I've rebalanced twice since then, moving some from C to G to keep it at around 30%.

I started withdrawals about 6 months after retiring. (about 6% of TSP - although only about 2.5 % of total retirement portfolio).

I'm still doing fine. I projected out my retirement funds and right now Im still ahead of my projections, though not by much. But my total withdrawal rate is still less than 2.5 %. With the inflation adjusted pension, I feel fairly secure.

Rick

 

[W2R]

Purron, another resource that might interest you is the TSPtalk message board:

TSP Talk Forums - Powered by vBulletin

You might already know about that message board, but anyway, it is very interesting to read about what the contributors there are doing with their TSP's.

 

[ats5g]

Check out the latest returns on the TSP:
TSP Rates, Current Monthly Returns, 2008-03-03

I know I'm not the only one around here with a healthy hunk of change in the TSP. Just curious about how my fellow TSPers are handling this. I previously had my funds spread around between many of the funds but dumped in all in the G fund last October. I was just being [-]paranoid [/-]cautious since my retirement was only 3 months away. I'd like to diversify but frankly it all looks pretty gloomy.

Have you figured out what type of return you're going to need in retirement to support your consumption level? If you don't need to take the risks of equities, and you're risk averse, then don't. It's as simple as that.

Be aware, however, that while the G fund has no market risk, it does have income risk, meaning that as interest rates on Treasuries move up and down, the interest rate on the G fund with move up and down.

As far as those TSP talk peeps go, aren't they the ones that were the cause of the soon to be trading restrictions in the TSP. If so, their returns have been pretty horrid.

- Alec

 

[Bimmerbill]

I was never impressed with the TSP talk trading folks. But then again, I'm not into active trading and market timing.

There is some good info on there sometimes tho.

15 years till I can retire at minimum age... D'OH!

 

[kaudrey]

Purron - I haven't looked at the balance since the end of 2007!

I am not retiring for quite a while yet, so I see this as a DCA buying opportunity. My allocation was OK at the end of the year (agressive mix of C, I, S, and G), so I won't remix until the end of this year.

I usually update my NW on a monthly basis, but I decided to take a break from that - maybe until 6/30, or even the end of 2008. We'll see.

I'm sure I would be more concerned if I was closer to retirement.

 

[Texarkandy]

Still 100% G since Apr 07 when the subprime rumours first started

planning ER in 05/09 but not planning to use any TSP till around 2020 -

hope to get some of my TSP back in the markets again when things settle down a bit (whenever that is!!!!)

 

[Tadpole]

G/F/C/S/I; 70/10/8/4/8 which is about 40% of my investments. I went from 40/60 over our investments at the beginning of 2007 to 75/25 in several increments ending in January. At the end I was locking in a small amount of loss but deemed it wise to take that last move. The 75% is 60% cash-like and 15% bond (largest is inflation-linked).

I will qualify for retirement at the end of this year but, as FERS people know, retiring at 60 or at least this year at 60 is probably not a wise decision. But there is some satisfaction in knowing that I could retire and be better off than most people.

I don't manage the TSP like most people because the Fidelity options may have higher costs but are far more versatile. So I make more use of G than most people to keep those options open elsewhere. I actually have more money in CREF stock than in the C fund.

Biggest mistake I made was moving more money to international funds at the wrong time to try to hedge against the falling dollar. Overall I am down 2% for the year with about .5% of that being my oil stocks, not my retirement accounts.

When I saw what was coming I talked to my husband for the first time about what I was thinking about doing with our asset allocation. It was a big decision and I saw air (lack of asset backed value) everywhere. What I didn't understand was that the air would be let out by devaluing the dollar rather than letting the markets collapse. My mistake; I can live with it. I will gradually buy back in when I think it is a better time.