Mid twenties, trying to get a leg up!

[eggthetank]

My TSP statement came in and I made a return of less than 2% last year and right now it's saying my YTD is LESS THAN 1%!!! I don't do much with it... I've changed it around a couple of times but... 1%?? Really??

I recently changed allocations to 50/50 G/F ... Current 2 year TSP balance is about 20k and it grows by about 1k/mo with matching contributions... I need to get my butt in gear!

 

[FogSailing]

Welcome ETT! There are many ways to go about this. Read the Forum and watch the charts and guidance posted by JTH, Bquat, Tsunami, DreamboatAnnie and many others. That will help you get a perspective of what's happening. OR, take the direct route and consider one of the TSP Talk premium services. It costs a few sheckles but would be a smart move for you. Simple straightforward advice about when to buy and when to sell. Best of luck to you in your investing.

FS

 

[uscfanhawaii]

My TSP statement came in and I made a return of less than 2% last year and right now it's saying my YTD is LESS THAN 1%!!! I don't do much with it... I've changed it around a couple of times but... 1%?? Really??

I recently changed allocations to 50/50 G/F ... Current 2 year TSP balance is about 20k and it grows by about 1k/mo with matching contributions... I need to get my butt in gear!

I would recommend for anyone just starting out, you NEED to get involved with equities. Of course, I was all equities for most of this year, and I am at -4% on the year. :embarrest:

But....Check the boards for investment methods. I used all equities and just relied on Dollar Cost Averaging for my first 25 years and that worked out pretty well (even with 2 major retracements of 20-30%). L lifecycle funds are another option. Bottom line though is to get involved with equities. G and F won't do it for you over the long run.

 

[Boghie]

My TSP statement came in and I made a return of less than 2% last year and right now it's saying my YTD is LESS THAN 1%!!! I don't do much with it... I've changed it around a couple of times but... 1%?? Really??

I recently changed allocations to 50/50 G/F ... Current 2 year TSP balance is about 20k and it grows by about 1k/mo with matching contributions... I need to get my butt in gear!

The only way your are getting those type of returns is by sitting in the 'G Fund'. That is the default investment, and we have all been stuck in park just like you early in our careers.

At your age no assets should be in bonds - the F Fund. That is an income fund, not a growth fund. While the G Fund makes around 2% the F Fund will make around 4%. Neither will do much for your retirement - they are really for either market timing or for folks nearing or in retirement. Another negative on the F Fund is that it is correcting (going steadily down) and has been doing so for a year. It is about -4% this year.

All your CONTRIBUTIONS should be in C/S/I - say 40%/30%/30%. To get a 7% - 10% average return you should be invested in C/S/I with your current holdings as well. Your current allocation will net you another Social Security check, a long term C/S/I will net you a driver for your Winnebago.

 

[eggthetank]

Thanks to everyone for their replies.

Welcome ETT! There are many ways to go about this. Read the Forum and watch the charts and guidance posted by JTH, Bquat, Tsunami, DreamboatAnnie and many others. That will help you get a perspective of what's happening. OR, take the direct route and consider one of the TSP Talk premium services. It costs a few sheckles but would be a smart move for you. Simple straightforward advice about when to buy and when to sell. Best of luck to you in your investing.

FS

I was considering a premium service as well, but it seems to be closed to any new customers at the moment so I think I'll give it a shot myself. Thanks!

 

[nnuut]

Welcome to the Forum eggthetank!!
You should be able to do better than that, but all of the indices are not performing well most to all are losing or flat, that makes it really hard to make any gains.
Stick around many of our Members are doing well for the year, check the Autotracker.
Best of luck.
Norman

 

[korekaza]

I'm in the same boat as you, these guys are giving you good advice. I've been working about 4 years now with my first two years 100%G and it just gets you no where. The G fund is good for playing it safe after making money from the other funds. I played the C-Fund for 2 years now and I easily made 3x + the money that the G fund got me for the first 2 years. Just do your research and look at trends. I like looking at 10 year and 5 year charts to get a feel for the market. The goal of TSP is long term earnings, day trading can feel great and fun but it's not the best for retirement.

 

[darrylwpugh]

I feel your pain. SDS is killing me!

 

[darrylwpugh]

I feel your pain. SDS is killing me!

 

[mbrogz3000]

The first thing to do, right now, is increase contributions! If your 25, you still have lots of control and time over posturing to retire at age 55 (or earlier) instead of 65. The ultimate goal should be to be able to retire when you want to retire, and not having to significantly factor in the pension portion of FERS or 'wait' for the paltry $25k vera/vsips (which at full career maturity is only a few months of pay!). I was hesitant, but the easiest way to increase contributions is to tick them up by 1% get used to having less money, and keep repeating that until you get it somewhere substantial.

Find a premade retirement saving planning calculator spreadsheet - punch in what you have now, what you plan to contribute throughout your career as your wages grow and some estimate rate of returns to establish expectation bounds. It will show you what your savings will be at various ages of life, and should alone will help entice you to increase contributions.

Also, I wouldn't put anything in G at the age of 25. Keep that money active in the 3 main funds (you can park contributions in G that way you aren't blindly bleeding away contribution money in the event shares are bought during a market sell off, then just move it when everything else is moved during an EFT), and somewhat low risk F fund. Take advantage of your 2 ETFs per month!

 

[maui21ice]

That's one thing I've been looking at and just did myself. I'll be 30 next year with about 27 more years of federal service left (if I max out), and just upped my TSP contributions to 10% after my last raise this pay period. So now with the 5% match, my total contributions are 15% which shouldn't be too big of a chunk of money to miss from each paycheck, but pay off down the road big time. I'll sacrifice now to live better later.