S FUND FOR LONG TERM?

[TheMailman]

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Is it very agressive to leave 100 % in S funds? I have had it for about 2 years in S fund . And would you people recomend it for long term? I plan on Retiring in 36 more years <---Short Time

 

[Guest]

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So your question is whether leaving your money in the S fund for thirty years would be a responsible action? *LOL*

Well, if you wanted to leave your money in one fund over the past 3 decades, the C fund would have been the best performing fund. The G fund would have been the worst performing fund.

With respect to C vs. S...more specifically, from 1984 to 2000, the C fund slightly outperformed the S fund...278% to 240%. So, to answer your question, the S fund has been OK over the long run but you might do slightly better with the C fund.

(Of course the next thirty years might be entirely different than the past thirty. *grin*)

 

[blueskys4ever]

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TheMailman wrote:

Is it very agressive to leave 100 % in S funds? I have had it for about 2 years in S fund . And would you people recomend it for long term? I plan on Retiring in 36 more years <---Short Time

It appears that you are a long-term investor.Long-term strategies differ from short term and a sit and wait policy appears to the norm for a large number of TSP investors. I see nothing wrong with this if you continue to add controbutions on a periodic basis. By sticking to one fund and adding continuely, your arereducing risk.

As for the S fund in particular, I have no crystal ball. Its anyones guess in this recent market. If it were my choice, I would go 50 C and 50 S for the long-term,but I must remind you I am not as long-term as you. GOOD LUCK!

 

[TEUFEL HUNDEN]

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Mailman I think that leaving your investment totally alonefor any lengthy period of time can have a positive or negative result. Why chance it, it's 50 50.

19995.99 -0.85 20.95 35.49 26.72

2000 6.42 11.67 -9.14 -15.77 -14.17

2001 5.39 8.61 -11.94 -9.04 -21.94

2002 5.00 10.27 -22.05 -18.14 -15.98

2003 4.11 4.11 28.54 42.92 37.94

2004 4.30 4.30 10.82 18.03 20.00



My belief is that it is your money, you should know what it is doing, what is happening to your money. IMO I would monitor it and be willing to make change as needed to maximize my return.
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[Rolo]

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Here's a table I made in Excel by copying the TSP historical returns and compounding each year's returns successively for the dollar amount for a starting balance of $1,000. C and S are close.

Order of returns:

1. C
2. S
3. F
4. G
5. I

1995 7.03 18.31 37.41 33.48 11.27 $1,070 $1,183 $1,374 $1,335 $1,113 
1996 6.76 3.66 22.85 17.18 6.14 $1,143 $1,226 $1,688 $1,564 $1,181 
1997 6.77 9.6 33.17 25.68 1.55 $1,220 $1,344 $2,248 $1,966 $1,199 
1998 5.74 8.7 28.44 8.63 20.09 $1,290 $1,461 $2,887 $2,135 $1,440 
1999 5.99 -0.85 20.95 35.49 26.72 $1,367 $1,449 $3,492 $2,893 $1,825 
2000 6.42 11.67 -9.14 -15.77 -14.17 $1,455 $1,618 $3,173 $2,437 $1,566 
2001 5.39 8.61 -11.94 -9.04 -21.94 $1,534 $1,757 $2,794 $2,217 $1,223 
2002 5 10.27 -22.05 -18.14 -15.98 $1,610 $1,937 $2,178 $1,815 $1,027 
2003 4.11 4.11 28.54 42.92 37.94 $1,676 $2,017 $2,800 $2,593 $1,417 
2004 4.3 4.3 10.82 18.03 20 $1,748 $2,104 $3,103 $3,061 $1,701