Q. I am retired (2008) and still maintaining my TSP fund. I don’t plan to dip into it for at least 5+ years. I am now 67 years of age (68 in July), and would like your opinion on the feasibility of moving my entire TSP holdings into the L 2020 Fund. Also, should I take that step, what are the penalties for withdrawal before 2020? A. It is possible for you to move your money into the L 2020 Fund and there are no penalties for withdrawals from the fund.
Browsing: L Fund
Q: I know nothing is guaranteed, but I’d like to earn 5 percent on my TSP balance over the long haul. Looking at the stats for the F Fund, it looks like putting my money in the F Fund will result in a 5 percent gain over the long haul, with only minor fluctuation, unlike the stock funds. I’d appreciate your insight, particularly on the flaws of my theory. A: If what you mean is: “How can I maximize my chances of earning exactly 5 percent, per year, from my TSP account?” then my answer is to invest it all…
Q: I enjoyed reading your article in the Federal Times Jan. 24 edition. I am 37, married with a 1-year-old and work for the GSA. I changed my allocations from the L Fund to the other funds, but what would you recommend? I want to be aggressive while also being a bit conservative, especially with this recession we are still going through. A: I can’t give you prudent advice without the proper information, analysis and understanding, but with your long-time horizon, you might consider allocating your TSP account as follows: C = 42%, S = 18%, I = 25%, G…
Q: I have $37,000 in my TSP L-Fund plus a $21,000 cash value on my life insurance policy. I plan to leave the USPS with 32 years of CSRS service at the age of 58. I have had a financial adviser suggest I put the combined money into an annuity-life insurance combination he says will give me a better rate of return over a period of time, without the $40 life insurance premium, for transfer of wealth to my family. I have put the extra money into the TSP to use for extra expenses after retirement (new roof, newer car,…
Q: I am a 60-year-old Federal Employees Retirement System employee. Good health holding out, I plan on retiring in 2025. I am saving the maximum allowed in the L 2020 Fund, with the thought that I may have to retire if health does not hold out until 2020. Your article in Federal Times on Dec. 13 said to choose the L Fund that corresponds to your life expectancy, rather than when you want to retire. Should I move my L Fund money to L 2030, or are there other allocations that you would recommend? A: I can’t responsibly give…
Q. I am a Department of the Air Force civilian and I plan to retire in June 2014. I will be 60 and have 20 years of federal civilian service. I currently have my entire TSP tied up in the 2020 L fund. Is it too early to put all of my funds into government funds for stability purposes? A. It’s not a question of timing, but of spending. You can move all of your money into the G Fund, if that’s what you mean, any time you like, but you’ll be limited to the lifestyle that can be supported…
Q: Is it possible to obtain the various recommended asset allocation models that you mentioned in your column of Feb. 8, 2010? That was an excellent article! A: Our allocation models are proprietary and intended for use as part of an integrated management process. You will find a useful set of TSP allocation models at www.tsp.gov in the L Funds section. Use the starting allocation for each of the L Funds as a guide.
Q: I just read the “lost decade” article in Money Matters and I am wondering why you did not mention the L Funds. I have all my Thrift Savings Plan funds allocated to L Funds as recommended to me since I am in my 10-year window of retirement. Is that a mistake? Should I also diversify into the other five individual funds? A: I’m not a fan of the L Funds, but I can’t say that using them is a mistake. The problem I have with them is that it’s difficult to know whether the robotic allocation shifts they make are…
Q: I consider myself very good at saving money for and with my family as well as managing my family’s budget. We have a young toddler, and my wife and I are still building our family. I am 34, have been with FERS (active employee) since I was 33, and I have four years of active military time I am almost done buying back. I have my wife saving a little more than 11 percent of her incoming from teaching school (company doesn’t match), and I save 15 percent per paycheck (20 percent if you count my federal match). I…