Spread TSP over its five funds


Q: I’ve been in civil service for 4 1/2 years. I’ve been in Thrift Savings Plan for about 3 years. I have my TSP invested 100 percent in the I Fund. I intend to work maybe another 10 years. I was thinking about putting 35 percent in the S Fund, 35 percent in the C Fund and the rest in the I Fund. The percentages are not set in stone but I am thinking about investing in the S Fund and the C Fund. Any suggestions?

A: I can’t provide specific investment advice through this forum — it would be irresponsible of me to do so. In general, I recommend that every investor identify the investment allocaiton that meets their needs with a minimum of risk, and periodically — at least once per year — rebalance their account to the appropriate allocation. In most cases, the right allocation will include all five of the TSP’s five basic funds. I can tell you that your current allocation, and the one you’re suggesting, is inefficient and subjects you to more risk than you need to take to acheive the expected returns they produce.


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Mike Miles is a Certified Financial Planner licensee and principal adviser for Variplan LLC, an independent fiduciary in Vienna, Virginia. Email your financial questions to fedexperts@federaltimes.com and view his blog at money.federaltimes.com.

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