Q. I had the same concerns as the person who you answered Aug. 8. He is trying to follow a bucket strategy and not sell off equities in a down market. I think there is a way to do this in the Thrift Savings Plan, but it is more complicated than I like. Suppose you have $400,000 invested equally in G, C, S and I. Assume your required minimum distribution is $12,000 or $1,000/month and it is paid on the first of each month. On the last day of the month, before 1200 Eastern time, transfer $300,000 to the G Fund. Money transfers…
Browsing: C Fund
Q. I have eight years and nine months of government service and had my entire Thrift Savings Plan contribution in the G Fund until about two weeks ago. I had around $50,000, and I moved that $50,000 into 40 percent C Fund, 40 percent S Fund and 20 percent I Fund, and moved my contribution from 100 percent G Fund to 50 percent S and 50 percent I. I am 34 and have probably 25 to 30 years of service left. How would you rate my contribution move? A. To rate it, I’d have to clearly understand your goals for the money…
Q. I understand why you defend leaving your money in the Thrift Savings Plan because of low expenses, security, protection from lawsuits, etc. However, how do you address the issue of “locking in losses” when withdrawing money in retirement from the TSP? For example, in an IRA, I can have (for a basic portfolio) a cash fund, an income fund and an equities fund. I know I can do this in the TSP, as well, G/F/C or S, but the primary difference is when I go to withdraw my money, in the TSP it comes out of all of these…
Q. I am 39. I contribute 12 percent of my salary to the Thrift Savings Plan. I have 50 percent in the L Fund and 10 percent each in G, I, S, C and F. I plan to retire around 62. Is this a reasonable contribution distribution? A. On its own, it’s not risk-efficient. If you don’t have a good reason to use this allocation, then it’s not reasonable.
Q. I am 31 years old and have five years of federal service. I am a GS-12, Step 3. I contribute 7 percent to the Thrift Savings Plan but have not done anything with the allocation: 100 percent to the G Fund. I have tried to determine the best allocation on my own, but there is too much information out there. I know that I need to do something now. I was thinking about 40 percent C Fund, 30 percent S Fund, 15 percent I Fund, 10 percent F Fund and 5 percent G Fund. Would this be a good start to set…
Q. I’ve been putting money into the C Fund and S Fund but keep 50 percent in the G Fund. I’m not doing too well. I move it when the stock market dips and put it back when it rises. Can I put all of my money into an L Fund and get better results? If so, which one? I plan to retire in 15 years. A. Really, selling after the market drops and buying after it rises isn’t working out too well? Go figure. Identifying and applying the asset allocation scheme that meets your needs with a minimum of risk would…
Q. I am 35 years old and am using L2040 for my fund allocation through the Thrift Savings Plan. I have been reading that I should be diversifying between C, S and I funds for a larger return, but I am not sure how to split the percentages between the three funds. How can I do that since I have 30 years or so until retirement? A. About 77 percent of your L 2040 investment is already in the C, S and I funds. You could switch to the L 2050 fund and increase that allocation to about 87 percent. If you…
Q. I have selected a retirement date of June 28, 2014. I will be 59½ years old with 33½ years of government service. I have been FERS my whole career. I have $365,000 in my Thrift Savings Plan. I will retire with a high-3 at GS-13, Step 4 and a 16.51 percent locality pay. I am debating paying off my mortgage on my retirement home by taking a partial withdrawal from my TSP. The reasons for this are: 1) Escrow of property taxes 2) Flood insurance imposed by Dodd-Frank 3) Desire to be mortgage-free in retirement. I owe $185,000 on…
Q. I have between 10 and 15 years to work until retirement (I am 52 yrs old). Right now, my contribution allocation is: S: 25 percent C: 25 percent L: 20 percent G: 30 percent The distribution is more diversified. What do you think? I don’t know what I am doing; therefore, I am just guessing. A. Your allocation is basically: 50 percent stocks, 20 percent bonds and 30 percent cash. This would generally be considered a moderately conservative allocation. Whether, or not, it’s right for you is impossible to say without more information and analysis, but it doesn’t appear to…
Q. I’ve participated in the Thrift Savings Plan since its inception as a CSRS employee and plan to retire next year. My current contribution allocation is 100 percent to the L2020 Fund and has been since that fund was created in 2005. Prior to the creation of the L funds, I had allocated my contributions equally to the C and G funds, which I have left untouched in the account. The account’s present holdings are approximately 50 percent L2020, with the remainder being 25 percent C and 25 percent G Fund. What should I now be doing, if anything, with those…