23yr old looking to be aggresive.

[okayDrain]

I'm fairly new to TSP (last OCT.) and obviously I'm going to be in for a LONG time. I've been in the G fund since I've started and I'm looking to get pretty involved. I'm under the impression I shouldn't worry too much about what the markets gonna be doing in the next 10yrs. I'm a E-5 in the uniformed services contributing 11% (works out to 265 a month) and make long deployments to sea where I'd like to start spending my time possibly monitoring the market. Any good reading material or sites I could look out for with good info. I also have a Roth IRA, any other suggestions on some things I could be doing with my money?

Thanks in advance for any help you guys have to offer a young sailor

My current contribution allocation is:

I 35%
S 25%
C 25%
F 15%

 

[nnuut]

Welcome to the Message Board, you've a good start keep that money flowing into your retirement plan and you will reap the benefits when you retire. Now is the time to be careful the Market really doesn't know which way to go and it's really easy to lose right now. So read all you can and check out the Auto Tracker to see what everyone is doing, read Tom's Daily Analysis and the Blogs.
Best of luck!
Norman

 

[Bullitt]

If you're posting on this site, you'll probably have a hard time not worrying about what the market will do in the next 10 years. Many on this board claim to have a set it and forget it approach only to burn out their 2 IFT's by the third day of the month. On any given day, I'd say about 10% of all internet blogs will be on the right side of the trade so I recommend your library or Borders bookstore as a starting point.

1. A reading list from a fund manager.
2. Thoughts on a Permanent Portfolio.
3. One of my recommended reading lists. Feel free to replace 4&5 with 'How to Make Money in Stocks' by William O'Neil, founder investors.com.
4. The Little Book series of investing. Don't forget to to read Common Sense Investing first though.

Good luck.

 

[Boghie]

Nnuuts advice is always well taken...

May I assume that the 15% in the 'F Fund' is an attempt to hold some in safety. Just watch interest rates - Treasuries, home loan, car loan rates can be a proxy. If they start going up pay attention to the 'F Fund' portion of your portfolio by logging into TSP every once in a while. Most of the time the "F Fund" is a better safe spot for someone your age.

Adding yourself to the AutoTracker after getting your post count up (a requirement set by Tom) helps. You can watch your accounts activity and performance excluding the effect of new contributions. Your contributions at this point can kinda hide actual performance by overwhelming it. Also, reading threads and posts here and looking at the AutoTracker can help you find others with similar investment styles and timeframes.

Finally, since military contributions are not matched I would look more closely at your Roth IRA. Your tax rate is not high right now so the Roth looks very yummy. Maybe invest in 'Exchange Traded Funds' that match the LBA (F Fund), the S&P 500 (C Fund), Wilshire 4500 (S Fund), and EAFE (I Fund). There is NO direct equivalent to the G Fund. The more I think of it the better I like it. Yummy. Maybe a 50/50 split so you could enjoy your time here

Finally after the finally, don't send your contributions to the 'G Fund' (the default) if you don't manage it frequently. I send mine 40/30/30 in C/S/I. Right now stocks are on sale. You want the market to be in the dumper when you buy stock. Yummy

Finally after the finally after the finally, I like Ray Lucia's and Ric Edelman's books. Especially 'Buckets of Money' and 'The Lies Abount Money'. 'Common Sense on Mutual Funds' is a basic. A good review of economics should include 'The Forgotten Man', 'The Ascent of Money', and 'Fooled By Randomness'.

Finally after the finally after the finally after the finally, I am too verbose and trade too frequently

 

[Boghie]

Bullitts advice is always well taken

There seems to be some commonality there on the reading list

 

[tsptalk]

Welcome okay! Just starting early gives you a huge advantage over most. Staying involved will eventually lead you to a strategy / style that fits your personality. Best of luck!

 

[okayDrain]

Thanks a lot guys! One more question, say when I pull in port and I know I'm not gonna be able to keep up with my "required reading" as much, would the L2040 fund not be too bad an idea to chill in until i can dedicate more of my time to research? Say 2-3 months once or twice a year.

 

[Boghie]

okayDrain,

Before you take any advice from me you should probably check the AutoTracker.

That's not a spot I'm familiar with - but it is getting kinda homey for me this year

Regardless, there seems to be seasonality in investing. I would park in 2040 for the November through January months if you cannot pay attention to your account. In the 2030 for February through April. And either 2020 or 2010 for the generally lousy summer months.

For you, even the 2040 has too much cash ('G Fund') and bonds ('F Fund') to keep your holdings in it for too long. However, the L Funds are nice places to hide assets when you are sending steel to target...

Thanks a lot guys! One more question, say when I pull in port and I know I'm not gonna be able to keep up with my "required reading" as much, would the L2040 fund not be too bad an idea to chill in until i can dedicate more of my time to research? Say 2-3 months once or twice a year.

 

[WallStreet]

OkayDrain,

I am a young investor as well and am also starting to read up on the TSP. I'm 24 and have been investing in TSP for about 5 months now.. Not long at all... and I have alot to learn about TSP. But similar to you I plan on investing agressively and watching my investments closely.

I'm glad I found your post because there is some great advise on here.. Lets keep in touch and maybe we can learn a thing or two from each other!

 

[law87]

OkayDrain,

I am a young investor as well and am also starting to read up on the TSP. I'm 24 and have been investing in TSP for about 5 months now.. Not long at all... and I have alot to learn about TSP. But similar to you I plan on investing agressively and watching my investments closely.

I'm glad I found your post because there is some great advise on here.. Lets keep in touch and maybe we can learn a thing or two from each other!

hey guys i am also a young investor, i am also an E5 USN i just begun visiting this site this year and i believe now is the time to invest, its scary at first but i think the reward will be worth while when we retire, i even spend my saving for my Porsche on stock and a house now, since housing market is rock bottom. i reccomend you guys check out the auto tracker, currently intrepid_trader is at the top, 24% YTD return is awesome! i also follow his thread on FAZ and FAS and taking his advice, while learning how to trade at the same time. good luck guys, smart mind like ours should retire comfortably thinking of the future.


*EDIT* one thing though, if you decide to go this route, make sure you stay with it, or else if your stock tank! so will your profit. GL

 

[Frixxxx]

My advice for you military guys....STAY IN!

I don't care how big a shaft your service is giving you.....STAY IN!

After 20 years with the military you get a check EVERY MONTH for the rest of your life......STAY IN!

If you retire as an E-8, The government buys an annuity to pay you. Right now if you are 40 at retirement you would get 2100/yr.

To support that payout, the annuity purchased would be for $500,000 at 4% yield at 40 years.

Name me a company that gives you that bonus at the end of twenty years?

STAY IN!

 

[Birchtree]

My daughter who got out in January as a captain would have a different message. She did however join the Army Reserve. But there was no way she was going to stay in - the main reason was that she wanted to utilize her education and work with a more professional type group. She made the sacrifice to move up in the civilian work force - she also gave up a $30K bonus to stay. She has a Roth 401K with her current employer and will do just fine - no more trips over seas. I should mention that she was recruited by her current employer because she was a JMO - junior military officer. So serving her country has provided some tangible benefits - she also met her present husband while in Iraq who was also an officer.

 

[law87]

funny today i was doing honor flights (greeting veteran of WW2, korean war and vietnam war as they flown into maryland) i met a 2 star air force general he says "i reccomend you to reconsider getting out, get an education and then get back in." i took some thoughts to that but with the economy on the brink of corrupting, i dont think i can do that. so Frixxx to answer your question i will stay in, but not because of the retirement pay but because of how the economy is doing right now.

 

[Frixxxx]

funny today i was doing honor flights (greeting veteran of WW2, korean war and vietnam war as they flown into maryland) i met a 2 star air force general he says "i reccomend you to reconsider getting out, get an education and then get back in." i took some thoughts to that but with the economy on the brink of corrupting, i dont think i can do that. so Frixxx to answer your question i will stay in, but not because of the retirement pay but because of how the economy is doing right now.

I recommend staying in....getting your degree, then get promoted to o-5/6 the get out...do the math.....check every month for breathing? Generals are too far removed from real life...If they were so great, why are there soo many 65 year old generals? They should have been retired loooooooong ago, instead they work for 1/2 pay?
Generals are great in war time....but their career decisions are a little suspect!

BT, I can respect the professionalism but your daughter may have a different message in 10 years!

 

[Birchtree]

I suspect if my daughter stays with the Army Reserve for the next 10 years she'll eventually make Big Bird and may get a small retirement with them. She is getting $41K from her Uncle to attend an MBA program and her husband is doing the same in his chosen graduate program. She is currently a consultant to BP in their refinery in Texas City, Texas. Bp is pumping in $500M to enhance their safety measures to comply with OSHA guidelines - she'll probably be working for them several years. I've already warned her that they may try to hire her away from her current employer. She does listen to dad - finally.

 

[law87]

I recommend staying in....getting your degree, then get promoted to o-5/6 the get out...do the math.....check every month for breathing? Generals are too far removed from real life...If they were so great, why are there soo many 65 year old generals? They should have been retired loooooooong ago, instead they work for 1/2 pay?
Generals are great in war time....but their career decisions are a little suspect!

BT, I can respect the professionalism but your daughter may have a different message in 10 years!

i wish i got his rank lol 12 grand every month for pushing papers? jesus i can do that anyday

 

[peterson82]

Thanks a lot guys! One more question, say when I pull in port and I know I'm not gonna be able to keep up with my "required reading" as much, would the L2040 fund not be too bad an idea to chill in until i can dedicate more of my time to research? Say 2-3 months once or twice a year.

I should think so, until they have a L2050 fund! L-2040 is great if you can't watch over your funds because it is aggressive at this point. They slowly readjust automatically to less and less aggressive - but at this point I am sure it is mostly the stock funds.

I went into the L-2040 fund until I figured out an investment plan for my TSP.

 

[WorkFE]

2040 is roughly 80% Stocks, 10% F and 10% G.

 

[Birchtree]

Put everything in the C fund and simply walk away - you'll own a piece of the largest companies available and their growth opportunities. If the market slips consider it a blessing because you'll dollar cost average in at lower prices acquiring more shares. Your objective this early should be to accumulate as many shares as possible. Learn before you churn. It takes many years to build enough of a base where you can attempt to make serious money to enhance your retirement potential. Think in terms of 40,000 C fund shares to pad the nest.

 

[okayDrain]

Thanks again guys for all your help. I'm noting each response and really appreciate your input. I'll throw this question out there since I haven't really seen it brought up through the rest of the site.



I've heard a couple times that I should be focusing a lot more on my Roth IRA at this time. I currently invest in a Balanced Strategy Fund. The question is, why should I be more focused on that currently, and what changes in the economy, if any, should I keep an eye out for that would signify I should shift my investing to the TSP?