TSP allocation recommendation


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 = 5%, F = 10%. This is consistent with my recommendation that, if you’re not sure what to do, choose the L Fund that most closely corresponds to your life expectancy and apply that fund’s initial allocation to your account. Rebalance your account annually to this allocation until a different L Fund is called for. It’s not the best you can do, but it’s better than a wild guess.


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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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