New to Forum---Funds in L2040

[mustang6867]

I am new to TSPTalk and don't know much about investing - just signed up for TSPTalk today and I had a few questions.

Current State - All of my contributions have been and are in the L2040 Fund with roughly 60k account balance, I have only been investing in TSP since 2011 and am currently 31 years old. I don't regularly check my TSP balance and am interested in figuring out how to make my money for me. My one concern with L funds is they only adjust investments on a quarterly basis.

1) Should I leave my funds in L2040? I hit mandatory retirement in 2040.
2) Should I change my traditional TSP to a Roth? I haven't due to the fact that my taxable income will be less than what I'm making now when I retire.

A gentleman in my office looks a historical market trends and moves his money into G funds when the market historically goes down. He is much closer to retirement than I am, do you think this strategy would be smart for me also?

Any other advice would be greatly appreciated.

Thanks,
Mustang6867

 

[PessOptimist]

I am new to TSPTalk and don't know much about investing - just signed up for TSPTalk today and I had a few questions.

Current State - All of my contributions have been and are in the L2040 Fund with roughly 60k account balance, I have only been investing in TSP since 2011 and am currently 31 years old. I don't regularly check my TSP balance and am interested in figuring out how to make my money for me. My one concern with L funds is they only adjust investments on a quarterly basis.

1) Should I leave my funds in L2040? I hit mandatory retirement in 2040.
2) Should I change my traditional TSP to a Roth? I haven't due to the fact that my taxable income will be less than what I'm making now when I retire.

A gentleman in my office looks a historical market trends and moves his money into G funds when the market historically goes down. He is much closer to retirement than I am, do you think this strategy would be smart for me also?

Any other advice would be greatly appreciated.

Thanks,
Mustang6867

Welcome. Someone smarter than me will be along soon to give opinions We don't actually give investment advice here. Read and learn. I congratulate you for not having all funds still in G as some I know who have been feds much longer than you still do.

Basics first, and excuse me if you are all ready doing what I suggest.

Learn how to log in to your account at tsp.gov. If you don't have a password they will send you one by US mail. You will need your account number from a statement. There is also a telephone number on your statement if you prefer to call them..

Make your payroll allocation at least 5% of your base pay to get the matching funds from your employer. I am assuming you are fed civilian. Military do not get matching funds.

Read everything you can on the MB. Read TSP Talk Market Commentary every day to see what Tom has to say and read the blogs. Look at all the charts even if you don't understand them. I still don't really understand them.

Read this TSP Talk - Getting Started and definitely look at this: TSP Talk AutoTracker

One strategy is to find someone on the autotracker (last url above) who is doing good and follow them. Before you commit to that, look at past years performance by that person. Links on the autotracker will show you many things.

In my opinion (look me up on the autotracker, I am mostly buy and hold) you are doing good so far and should leave it in L2040 until you look around and decide for yourself how to manipulate your funds.

As far as ROTH goes, did you mean future or converting it all to a ROTH? If you convert the existing balance to ROTH you will have to pay income taxes on it at the current rate. If you meant for future contributions it depends on your current situation tax wise. ROTH contributions to your TSP will be taxed as regular income. Your contributions now are tax deferred meaning you will be taxed on distributions based on your income at the time. The beauty of ROTH contributions is that the contribution and all income from that contribution are always tax free. So far. Someone smarter than me will know more about that.

The gentleman who moves things around based on history is using what I believe is called "technical analysis" where you look at historical charts and predict the future. That is what TA is in my opinion. Look around and learn. There are many charts to look at and many rules that some people explain from time to time in their account talk threads.

Good luck.

PO

 

[mustang6867]

PO,

Thanks for the help on where to research/learn on this website.

I currently have a set dollar amount I put into my TSP, right at 10% of my base pay. As far as the ROTH question goes, I was just curious which one made more sense for me at this point in time. I am in the 25% tax bracket, and don't have any substantial tax deductions. So I believe that lowering my taxable income at is probably the best choice.

Time to start learning!
Mustang6867