Q. I will be 70 and a half years old soon, and I have to take TSP distribution. Where should I invest this money to keep it growing?
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Q. I’m planning to retire as a federal law enforcement officer in March 2016 at age 50. I currently have all of my TSP invested in the L2020 fund. Others at Federal Times have recommended using the Lifecycle Fund that matches your life expectancy versus your target retirement year. I will be taking 72t life expectancy payments from my TSP beginning at age 50. Should I consider moving my TSP into the L2030 or L2040 funds? Is this more likely to make my TSP balance last longer into retirement?
Q. I plan to retire on Aug. 31 under FERS. Will I get a 5 percent matching contribution if I make 5 percent of my last paycheck (payable on Sept. 11) to TSP? Can I contribute 5 percent of my lump-sum pay from the unused annual leave? If so, will I get a 5 percent matching contribution?
Asset allocation is a term that should be familiar to anyone with a Thrift Savings Plan account. It’s everywhere in the investing world, but I have found that few investors understand what it is and what it is supposed to do. This is a serious problem since asset allocation is the main driver of investment performance. Study after study has shown that asset allocation overwhelms things like market timing and security selection in its impact on investment results. The TSP recognizes this and makes allocating your investment assets about as easy as it could be. Before you can use asset…
Q. I am a law enforcement officer planning to retire next year at age 50. I have a pretty good sum in my TSP and would like to take life expectancy (72t) payments. Two financial advisors have told me I shouldn’t need this money (after reviewing my expected income and expenses) and advised against taking the distributions. What is the downside of sticking with life expectancy payments for 10 years if I am invested correctly? It seems to me, assuming a greater than 5% return over this period, I should never touch the principal. Currently my TSP is fully invested…
Investing for retirement income is very different from investing purely for growth. As you approach retirement, there is rarely any good measure of the quality of the investment decisions that got you where you are today. You probably have no way of knowing what the mistakes you made yesterday have cost you today. Investing for retirement income is much more an exercise in avoiding mistakes, than an exercise in maximizing the potential for gains. Avoid the following common mistakes and you’ll be well on your way to maximizing the standard of living you’ll enjoy throughout your retirement. This list of…
Q. I’m an engineer that so far has three years with the government, I’ve chatted with my colleagues at work about the TSP and how one can really reap the benefits of the program with some good analysis and risk factoring. I have 10 percent of my bi-weekly check go toward the TSP and split my allocations 50 percent G fund and 50 percent C fund. I would like to be more active in seeing my funds grow and was wondering what the best way to do that is? So far, I’ve just been letting the TSP sit and haven’t…
When you are young and just starting your career, it is difficult to determine how the investment decisions you are making will someday affect your standard of living in retirement. If you’re already near or in retirement, you probably don’t know how much that mistake you may have committed 20 years ago is costing you today. You bought this and sold that from time to time, and here you are. Once you retire and begin withdrawing from your investments to support your standard of living, however, a single mistake can become painfully evident, down the road — in 10 or…
Q. I am going to retire within the next three months. I have done my homework but am torn about my TSP. I don’t know what is the biggest bang for my buck — roll over my TSP into another investment (not knowing which one yet) or to leave it where it is. Since this will be part of my retirement, I want to pay as little as possible in maintenance fees. My fear is that the new MyIRA could be looming over my TSP. I do not want to invest my hard-earned money into worthless government bonds. It is…
Q. I’ve read articles that are beginning to convince me that the TSP L funds are too conservative when the L fund “year” is based on the nearest year of retirement. It has been suggested that one should choose an L fund based on estimated longevity. Essentially, select an L fund by adding 20 or 30 years to your planned year of retirement, depending on your health, family history, etc. I am presently in L2020 and plan to retire in late 2018. Maybe I should be in L2040 or L2050. What are your thoughts on this? A. I know that…