Federal Retirement Thrift Invesment Board

[rokid]

Re: Federal Retirement Thrift Investment Board

I nail the "newbies" as quickly as possible to let them know. Tell them they can set up contributions to TSP immediately even thought they will not get matching funds right away. That way they don't "forget".

Keep up the good work. For FERS employees, TSP isn't the icing on the cake, it's at least 1/3 of the cake. In addition, for most, the L Funds are the best choice.

Since I didn't know anything about investing until three years ago, I'm glad I stayed in CSRS in the 1980s. My rationale was, if the government wanted me to convert to FERS, I was probably better off in CSRS.:toung:

Incidentally, 35 days, 13 hours, 44 minutes, and 20 seconds until retirement. But who's counting?

 

[James48843]

I guess I have a dimmer view of my fellow government employee. Some of them are just plain stupid. Most of the new employees will have 20+ years till retirement. They have zero business being in the G-fund.

I hate to say it, but yeh, that's what I believe too.

I wish our employer would give multiple seminars in the employee's first year. The first one, for two hours long, explaining what the TSP is, and how it is critical to become a portion of your retirement expections. That one should be given within the first 30 days of employment. It should close with passing out forms and telling people how they sign up for more than the minimum.

I think that should be followed in the following January with another 2 hour seminar. This time explaining how each of the TSP funds work, and how much the employee would have had if they had contributred 10% since day one of their employment, in each of the funds, and how January is a good time to up your TSP contribution now that you've had time to adjust to your salary, and , if you are lucky enought to get a January pay raise, to have a concious opportunity to apply that increase in salary to your retirement. To talk about Agency matching, and how some people don't invest enough to get their "free money" from the Agency.

I say lucky enought to get a January pay raise, because in the FAA, under "Core Comp", if you are not hired into the Agency before July 1st, you don't get any pay raise the following Janaury. That is our glorious employer. And another reason why TSP is so important- it is what is going to be paying you when you are old and eating oatmeal every morning.

And finally, another 2 hour seminar at the one-year mark, to recap the TSP options, answer questions, and to give as real examples, the people in the class, and how much they've been able to save, and let each person compare each other and what they've done with their nest egg. That should motivate some people to make very, very consious decisions about their own money.

 

[James48843]

PS: I use to e-mail our union about this problem. Our stewart finally got a fix in 2006. We had a seminar.

Yep- I am our Union rep. And I try to do the TSP seminar, because our employer is falling down on that job. Our Union is the only thing we have looking out for employees' best interest.

 

[James48843]

Re: Federal Retirement Thrift Investment Board

In my aging, I am beginning to believe that the L fund is a better default than the Gee for "new" employees with 20 plus years until MRA.

...Best thing we can do is talk to our co-workers and get them interested. I nail the "newbies" as quickly as possible to let them know. Tell them they can set up contributions to TSP immediately even thought they will not get matching funds right away. That way they don't "forget".

...

Back to the L funds. Long term the L's should do well for folks who do nothing.

I even believe "L" funds are better sometimes than those actively trying to trade. Last year I finished number 9 in the "after Jan 1st" people, and thought I had a great handle on buy low/sell high.

This year, the L2040 and the L2030 are both doing better than my active decision making and occasional movement.

More power to the "L" funds. They are working just fine!

 

[Show-me]

Re: Federal Retirement Thrift Investment Board

I even believe "L" funds are better sometimes than those actively trying to trade. Last year I finished number 9 in the "after Jan 1st" people, and thought I had a great handle on buy low/sell high.

This year, the L2040 and the L2030 are both doing better than my active decision making and occasional movement.

More power to the "L" funds. They are working just fine!

Same here! I'm so far down on the "tally" I forgot what it is like to make a buck. LOL!!! It's OK my day is coming and this is a work in progress. Some of us have to learn the hard way. I have 18 plus years to MRA.

Funny thing..........I'm a Union Rep also and the only one in my facility beating the TSP/FERS/Soc.Sec. drum.

 

[qibovin]

Re: Federal Retirement Thrift Investment Board

Long term the L's should do well for folks who do nothing.

emphasis added

Again, if they sign up then never check it, they are still not doing that bad in the G fund. I was irritated, though I had only myself to blame, when I finally got around to check up on my IRA that I had started before TSP was an option for the military, only to realize that it was worth less at that time than I had put into it. If that had been my TSP account that I may have started just before deploying--or just didn't think to check it for whatever reason--and I had found out that it was worth less than the total of my contributions because it had defaulted to an L fund during a down market (AND that I didn't even get any tax advantages because my income during that time was already tax free) I'd be irate. And that is despite the fact that I probably would have opted for the L fund myself if/when given the option prior to a deployment with questionably reliable access to managing it actively.

I think that someone who doesn't know enough to "actively manage" their TSP--whether swing trading or choosing a buy-and-hold allocation appropriate to their risk comfort level--will still be pleasantly surprised at what they find in their TSP account after, say, 20 years, even if the default is G.

Still, I agree with all the posts on better education. My first thought was that this "education" shouldn't take place during "work time," but then I considered how much more important this education is than yearly repetitive mandatory training on "Consideration of Others," "Ethics," and whatever else. I'm thinking that if more people in the workplace had a little better peace of mind knowing that "the money was in the bank" for a comfortable retirement, they'd be a lot nicer to each other every day and not feel like they needed to steal office supplies or buy a boat with their government credit card.
Then we wouldn't need all those other classes.

Anyway, I can't even remember how I found out that the military was offering TSP. I think I read it somewhere and then had to figure out some convoluted process on signing up myself. If I remember correctly, there were only certain, very limited times during which you could sign up and you'd better be darned sure you chose the right amount to contribute because you couldn't change that again until the next limited period. The default was to the G and you couldn't change it for a month or so. That's the part that needs to change for the biggest impact on the most people. I think that for most people that leave their money in the default, it is because of this "waiting period." Most people that want to "sign up and forget about it" would probably opt for the L funds when they signed up. I would support that option rather than an L fund default. Even if this month delay is somehow unavoidable, if they would let people sign some forms at the time of sign up so their funds would automatically transfer into L or whatever allocation they chose at the time of signing up, that would be a big improvement. These "sign-up-and-forget-about-it" folks aren't going to remeber or don't want to be bothered with having to come back a month later to select an allocation.
//off soapbox

Anyway, kudos to those of you taking up the education baton on your own and not waiting for the bureaucracy.

 

[Wolverine]

When TSP started in 86.... Everyone was with CSRS. FERS only applied to very few. TSP grew from the G-fund to what it is now. As it branched out into stock funds there should have been participant meetings to explain how to manage and invest wisely. The managers were in CSRS, that was where the ball was fumbled. So now some folks in FERS mishandle their investments. Heck they have been treated like mushrooms. How many folks have been to a TSP investment seminar? How many folks stumbled on to this web site and said Wow!.......:nuts:

PS: I use to e-mail our union about this problem. Our stewart finally got a fix in 2006. We had a seminar.

Interesting thoughts here Spaf..........Got me thinking on a couple things also.

I started in FERS and have yet to come across any TSP seminar in the local area. If so, I have missed it. Nothing from the Union or even just word of mouth. What it comes down to where I am at is, everyone out for themselves and one had better be aggressive in doing your own research into finding out what is what with the TSP. As far as I am concerned getting any info from co-workers is just about useless. I don't trust it or them. Anything I have or will get from them I will check the info out myself from many angles so as to get the straight scoop myself. Almost like a covert operation and all. LOL One is better going independent where I am at and getting the info themselves. Saves on getting mixed signals and all also.

If I ever do come across a TSP seminar in the future around here I would sure investigate the source of who is doing it and the background of how good they are with it. I will not take the word of co-workers with any of this stuff.

Another tid bit here also with how I came to get to this site and all. I was just trying to remember how I did it. LOL

I was browsing one of the Postal sites which I have had and really had not looked at it for sometime until recently. I was just going through my favorites and cleaning house at the time I did this also.

http://www.postalworkersonline.com

Anyhoo, at this site down the left hand column where it says.......More PostalMag and down further under that you will see Thrift Savings and click on that. This is exactly how I came about this Website, by accident and yes it was a big WOW! LOL

In Fact, I don't even know if anyone where I work even knows about this site or is involved with it. I have never heard anyone mention it ever.

That is my story and I am stickin with it. LOL

 

[James48843]

The Federal Retirement Thrift Investment Board has released February 07 Meeting minutes.

They are here:http://www.frtib.gov/FOIA/minutes-board-member-meetings_2007Feb.pdf

Some really good reading- 14 pages.

Saul says we shouldn't ever day trade.

Saul says: Day trade= BAD.
Saul says: L-Fund= GOOD.

He says we should just stick the money in "L"s and leave it there.


Sorry Saul- I'm doing ok managing my own, thank you.

 

[uknowwho]

I think it is a good call.

 

[James48843]

The minutes of the June board meeting are now available at:

http://www.frtib.gov/FOIA/minutes-board-member-meetings_2007Jun.pdf

A lot of good discussion about keeping politics out of the TSP investment fund managment plan. I.E. against making a "Darfur free fund", etc.

Looks like the Board is right on track.

Plus, the funds increased in value 6 BILLION in May- and more are using the "L" funds than before.

Read the whole minutes if you get a chance. Nice reading.

 

[offtrack]

Thanks for pointing this out James. I was looking forward to reading more on their discussion of ROTH. (Read under the addendum to minutes Attachment 4)

There seems to be strong support for the ROTH among employees with 60% favoring and noting that 12% skipped the question, indicating a lack of knowledge of ROTH, we have more than 3:1 favoring a ROTH.

Arguments against ROTH were strong on costs of implementation, citing figures like $3 1/2 million to update record keeping, accounting, and interface.

Add another $5 1/2 million for education ($13 Million if we each get a DVD like with the L fund drive which was a complete waste)

Add another $4-6 million for implementation of a "speciallly trained 3rd party retirement counseling service" to address the higher expected call-in volume if a ROTH were implemented. More waste IMO.

They didn't cite costs for implementation in Uniformed Services and the individual agencies but I'd add another $3 1/2 million for that.

Still all told, that's under $20 million for implementation (if we exclude that $8 million DVD) That is no more than $5-6 per participant for an option to bury $15k a year tax-free. Hmmm, what's that smell? Somehow I get the impression the FED isn't all that willing to give us that perk.

They plan to reevaluate in 2 years. You young guys ought to lobby your asses off for that ROTH.

 

[FundSurfer]

Read the whole minutes if you get a chance. Nice reading.

Yes. Especially if you are having trouble sleeping at night. Print these out and read in bed.

I thought this bit of data was interesting:


We analyzed the activity of new hires during the period 2004-2007 as part of this recommendation. During this period, forty-eight percent took no action and remained 100 percent invested in the G Fund. Sixty-two percent of these participants were under 40 years old. The G Fund is not the correct fund for a long term Retirement investment. The Employee Thrift Advisory Council supported this proposal without objection.

48% stayed 100% G? How sad is that? I'm with James, I'm glad they managed to get the default changed.
​

 

[James48843]

Minutes of the July meeting are now posted on-line at this address:

http://www.frtib.gov/FOIA/minutes-board-member-meetings_2007Jul.pdf

Some interesting reading about the sale of the company that now runs the call center. If you worried before about the company that took over from real government employees, and put our accounts into the hands of a public corporation- you will be more concerned now. It's being bought out by a privately-held corporation, which means there are no public SEC filings required.

Who is it that actually has access to your account and your money?

Good question.

 

[SkyPilot]

That is no more than $5-6 per participant for an option to bury $15k a year tax-free.

Not tax free, but rather, taxed up front.

 

[SkyPilot]

I think the FRTIB wants us all to just go to the L funds.

How long until someone on the board proposes eliminating the various funds and just giving us the options of which L category we want?

 

[SkyPilot]

Hmmm, what's that smell? Somehow I get the impression the FED isn't all that willing to give us that perk.

They plan to reevaluate in 2 years. You young guys ought to lobby your asses off for that ROTH.

Why wait for the FTRIB? If you crunch the #'s, and it works for you, establish a ROTH for yourself now. There are any number of good investment planners that would love to help.

 

[BeaverState]

I think the FRTIB wants us all to just go to the L funds.

How long until someone on the board proposes eliminating the various funds and just giving us the options of which L category we want?

If that happens hopefully we can gain support for a letter writing campaign. A petition is good, but 10,000+ letters arriving in a week is much better.

 

[BeaverState]

I've never understood why they made the L-funds in the first place. Let alone spending millions of our dollars to promote them. It seems it would have been much more cost effective to simply post "suggested" account allocations on the front page of the tsp.gov website. Or simply email each of us once a year with the suggested account allocations according to a persons age or proposed retirement date. Government employees should be smart enough to figure these things out for themselves.

 

[SkyPilot]

I think (opinion) that the FRTIB was getting nervous in that so many Feds were just leaving their balance in the G fund. Ultimately, they could forecast a lot of Feds getting to retirement and not having enough cash, thus indicting the change from CSRS to FERS.

So, the L funds (not really funds at all, just composite blends of the existing funds) provided a useful way to get Feds off their duff and at least passively involved in their own retirement.

Now, the FRTIB is getting cocky, and feels that their plan maybe better for everyone than individual choice. They don't even want people to change between funds, and have expressed frustration that participants don't put all their balances into the L funds.

I get the feeling that they think they know better than I do how I should handle my TSP account.

 

[Show-me]

Why wait for the FTRIB? If you crunch the #'s, and it works for you, establish a ROTH for yourself now. There are any number of good investment planners that would love to help.

You bet!!! Why wait? Look at all the ETF's you can invest in. :nuts::laugh: