1st Post...TSP inter-transfer...G Fund to...?

[Roguejim]

I began contributing to TSP in 1995(10%). All contributions went into the C Fund, until just prior to the current presidential election. At this point funds were transferred to the G Fund. I'm 59, and plan to retire in about 6 years. I had a recent talk with an EJ financial planner(free talk!) who advised I move the money into the L20/L30 Funds after the market recedes to ~19,200. So, here I am, and the stock market continues to climb. Should I just transfer the money into the L Funds now? Wait for a market correction? Do something else? Thanks.

 

[Frixxxx]

I began contributing to TSP in 1995(10%). All contributions went into the C Fund, until just prior to the current presidential election. At this point funds were transferred to the G Fund. I'm 59, and plan to retire in about 6 years. I had a recent talk with an EJ financial planner(free talk!) who advised I move the money into the L20/L30 Funds after the market recedes to ~19,200. So, here I am, and the stock market continues to climb. Should I just transfer the money into the L Funds now? Wait for a market correction? Do something else? Thanks.

Loaded questions,

Do you have enough saved in that leg of your retirement stool where you need to protect it? Or can you assume some risk?

If so, that will allow you decide how to enter into the market and where.

Good Luck!

 

[Roguejim]

I have $300k. No other accts other than my wife's 401k at her new job. House is paid for, so no large debt.

 

[RazorCat]

Welcome Roguejim. There's a great deal of good advice to be had on this site. I would highly recommend you explore the various Premium Services available on this site to determine if one of the fits your investment style and goals.
Enjoy.

 

[DreamboatAnnie]

Hi Roguejim, Welcome to the Forum!

Sounds like you plan to retire with 27-28 years of service under FERS. So you get (1) social Security, (2) FERS annuity plus (3) your TSP. I've heard it said folks should determine how much is needed per year to live, subtract estimated SS and FERS annuity, to then leave the amount needed from TSP or other investments and savings. Also, need to use IRS tables to look at longevity /life expectancy tables.

If one is expected to live 25 years after retirement (into 80s), which is more common now, you should divide that into the TSP savings to give you idea of how much you'll get per year. So, thats about $4,000 per year for every $100K you have saved.

So you would be drawing about $12,000 per year from TSP based on the $300k saved to date. That's $1k per month just from TSP with current balance.

You'd just need to consider the risk you are willing to take during the next 6 years before you retire.

I tend to believe that buy and hold with mix of G and C and S fund (per your acceptable level of risk), or premium services, is best unless you plan to spend a lot of time managing your account, keeping up with the market and learning as much as possible about investing in the market.

Monitoring the market and managing your own money is not for the weak of heart, as I have been learning. I am now within 5 years of retirement and it gets harder to see market drops. But quite honestly staying in G fund will not provide much growth...then again its very low risk! It comes down to what you think is best for you. Tough decision.

P.S. i don't like the L funds because I think the allocations put too much in the I fund and overall too much in the G fund. I would consider allocation like that of tge L2020 but take the % from the I fund and put it tiwards the S fund instead. But that's just me!

Best wishes !!!!!!!! :smile:

Link to L fund info sheet
https://www.tsp.gov/PDF/formspubs/FundsL.pdf

 

[nnuut]

Welcome to the forums Roguejim!!:laugh: Can't give you advise because I really don't know if it will continue UP or Dive into the abyss. Read and learn or Join one of our Premium services or just make up your own mind, plenty of information here. Best of luck with your TSP!
Norman

 

[evilanne]

I began contributing to TSP in 1995(10%). All contributions went into the C Fund, until just prior to the current presidential election. At this point funds were transferred to the G Fund. I'm 59, and plan to retire in about 6 years. I had a recent talk with an EJ financial planner(free talk!) who advised I move the money into the L20/L30 Funds after the market recedes to ~19,200. So, here I am, and the stock market continues to climb. Should I just transfer the money into the L Funds now? Wait for a market correction? Do something else? Thanks.

I don't care for the L Funds. As of January 2017, the breakdown of 3 of the L Funds below. How do you feel about the breakdown & risk associated with each?
[TABLE="class: grid, width: 500"]
[TR]
[TD]
[/TD]
[TD]

2020​

[/TD]
[TD]

2030​

[/TD]
[TD]

2040​

[/TD]
[/TR]
[TR]
[TD]

G​

[/TD]
[TD]

52.94%​

[/TD]
[TD]

31.21%​

[/TD]
[TD]

20.49%​

[/TD]
[/TR]
[TR]
[TD]

F​

[/TD]
[TD]

6.06%​

[/TD]
[TD]

6.04%​

[/TD]
[TD]

6.01%​

[/TD]
[/TR]
[TR]
[TD]

C​

[/TD]
[TD]

22.68%​

[/TD]
[TD]

34.14%​

[/TD]
[TD]

39.32%​

[/TD]
[/TR]
[TR]
[TD]

S​

[/TD]
[TD]

6.02%​

[/TD]
[TD]

9.78%​

[/TD]
[TD]

12.13%​

[/TD]
[/TR]
[TR]
[TD]

I​

[/TD]
[TD]

12.30%​

[/TD]
[TD]

18.83%​

[/TD]
[TD]

22.05%​

[/TD]
[/TR]
[TR]
[TD]

FG/Bonds​

[/TD]
[TD]

59%​

[/TD]
[TD]

37.25%​

[/TD]
[TD]

26.5%​

[/TD]
[/TR]
[TR]
[TD]

CSI/Stock​

[/TD]
[TD]

41%​

[/TD]
[TD]

62.75%​

[/TD]
[TD]

73.5%​

[/TD]
[/TR]
[/TABLE]

https://www.tsp.gov/InvestmentFunds/FundOptions/fundPerformance_L2020.html
Personally, I think L2020 is too conservative and all of the L Funds have higher percentages in the I Fund than I am comfortable with currently. Since you will be getting a pension [1.1% X (#Years) X (AVG High 3 Salary)], you can afford to take a little more risk to obtain higher returns, but it depends on your risk tolerance. I know one person that recommends treating your annual pension as a bond equivalent when determining the allocation of stock in your TSP based on all assets/income flows within your portfolio. Since I retired early I'm a little more cautious presently. With the market at it's current level, I am keeping a certain percentage of funds in the G Fund (amount that I'm not willing to lose in a crash or significant pull back). Good luck in whatever you decide to do.

 

[tsptalk]

Welcome Roguejim! Thanks for joining us.

 

[nasa1974]

Roguejim,

Welcome aboard.

What you want to do with your TSP account all depend on your comfort level. If you can live with big ups and downs without getting ulcers than you might want to get aggressive. Or any combination of funds might work better (ex. 50% "G" 25% "C" & "S"). This is a great place to learn and ask lots of questions.

 

[waslhl]

What I've always heard is that a general "rule of thumb" is that you should be prepared to lose - at least in the short-run - about 50% of what you have in the market. Of course, chances are good that, over the long haul, you'll recover anything you've lost and then some - but, obviously, that doesn't do you any good if you end up needing the money in the interim (and there's no guarantee as to how long "in the interim" might be)! So it really all depends on how much you're willing to put at risk at this point in your life. Because the reality is, nobody can predict the short-term future of the market with absolute certainty - and, if it goes down, it might not come back right away. So the goal, I think, is to be able to know that, at any point in your life, no matter what happens with the market, you'll still have enough money to live on.

Loaded questions,

Do you have enough saved in that leg of your retirement stool where you need to protect it? Or can you assume some risk?

If so, that will allow you decide how to enter into the market and where.

Good Luck!

 

[RazorCat]

Welcome Roguejim and waslhl.

 

[Roguejim]

Thanks for all the advice. I think my tolerance for risk is pretty low. My fear is not being able to recoup large losses by the time I retire. Still undecided.