Author militaryonline

When it comes to funding a retirement income stream, it generally doesn’t matter as much where you save your money — Thrift Savings Plan, IRA, Roth IRA, 401(k), etc. — as it does that you actually save your money. Unfortunately, sometimes, more attention is paid to whether money should go to this or that type of account than to whether enough is being saved to safely support the desired retirement income stream, or even how the money will be invested once it is saved to a particular kind of account. I’ve seen this confusion over priorities in the attention to…

As a Thrift Savings Plan participant responsible for managing your own pension fund, you would be wise to understand investment diversification, which means allocating your money among different investment assets — putting your eggs in many baskets. Why diversify? The usual answer — to reduce risk — is only part of the answer. The real reason to diversify is to improve — or better yet, optimize — your portfolio’s risk-adjusted expected rate of return, which is the rate of return your portfolio is most likely to produce in the future, adjusted for the risk that it will fail to produce…

Are you afraid of losing money? Terrified that if you put your Thrift Savings Plan contributions into anything but the G Fund, you’ll do it at the wrong time and suffer huge losses? I’ve even heard TSP investors express fears about investing in the G Fund. While it’s certainly better to make money than it is to lose it, the fears that seem to be running rampant lately are often irrational — and might wind up costing you your lifestyle in retirement. I clearly remember the optimism that reigned over the investment world during the late 1990s. Investors were scrambling…

Experience and research show that investors consistently act irrationally in managing their investments — buying and selling the wrong things at the wrong times and for the wrong reasons. For the young investor, the cost of these mistakes will never be known, since there is rarely a clearly defined goal against which to measure performance. But, for retired investors, the mistakes can be painfully costly since they can result in unexpected, and unpleasant, changes in lifestyle. It would be interesting to see how different your investment decisions regarding your Thrift Savings Plan account might be if you had make-or-break performance…

The recent revelation that 260 federal employees and annuitants and their families may have lost some $34 million to a crooked investment manager is a loud and clear wake-up call. Wayne McLeod and his firm, Federal Employees Benefit Group, are accused by the Securities and Exchange Commission of defrauding a group of investors, many of them federal law enforcement personnel, in an apparent Ponzi scheme. According to the SEC McLeod admitted perpetrating the scheme to investigators before taking his own life. While this story is shocking and sad, it is also instructive. I met McLeod at a seminar several years…

If you have a Thrift Savings Plan account, you’re an investment manager. If you’re counting on that TSP account to provide income for your use in retirement, you’re a particular kind of investment manager: a pension fund manager. As a pension fund manager, it’s your job to do whatever you can to coax the fund — your TSP account — into supporting the benefits you’ve promised yourself. If you are, or will ever be, entitled to a Civil Service Retirement System or Federal Employees Retirement System annuity, you probably, and rightfully, expect that the providers of that annuity make good…