Sunkissedbeach's Account Talk

[sunkissedbeach]

Hello,

Re: Need some help to set up allocations.

Just found this site today. I am completely ignorant about the market, although I am the one who does all of our finances.
We have no debt, 100,000 of CD's and we our looking at purchasing a home when the bubble finally draws a conclusion.

My husband will retire in 15 more years, He only has 108,000 in his TSP. He has borrowed from it a few times, and lost a lot of money in the 90's. He will receive a military (Tech Sargent) pension as well as TSP and SS.

What should his allocations be set at. I have made a interfund transfer to 50% C and 50% G but what about his allocations what should they be set at?

How can I learn more about this, you people are experts and seem to change around your allocations all of the time to save and make money. I want to do this but have no clue how or who to ask for help.

Please help.

SKB

His allocations were:

G Fund 0%, F Fund 0%, C Fund 50%, S Fund 25%, I Fund 25%
He had (before I changed everything to 50% C and 50%G today)
C Fund 83,312.
G fund: 6,916
I fund 7,394.
S fund 6,329
F Fund 4,29
I have want to change his allocations properly what do you think?

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[Spaf]

Re: Need some help to set up allocations.

Hi SKB,
Please see the TSP.gov site where they talk about the new Life Cycle funds (the L-Funds). These ar funds built on a time horizon. They do have risk, but miminized. If you go with the regular funds TSTTalk has some suggested allocations for long term investing, see Allocations. Not being market savy and using a blind allocation, is not to your advantage. If you would like, stay on board and learn about investment strategies, what works and what doesn't.
We are not financial advisors, but we can point you to various options that are available.
Regards
Spaf

 

[ocean]

Re: Need some help to set up allocations.

Welcome SKB,

I can’t give you advice on what allocation you should do. Don’t want to sound like a commercial, but the TSP Timing Newsletter by RevShark (on the home page of this site) may be a starter for you. It costs about $20 a month and the weekly newsletter will advice you what to allocate your funds for the coming week. It really is a small cost comparing with how much you can profit from the proper allocations.

Current returns starting from Feb 1, 2006 is about 5.37%. The returns is not bad at all and it beats the G/F/C/S funds so far this year.

As you learn more about the TSP allocations from the participants on this site, you may want to try something on your own. But until then, you may be better off to stick with the pro for the time being. I had subscribed the newsletter for a short period of time and found the allocation advice on the risk level is moderate and it should fit you as a beginner.

Good luck

Ocean

 

[rokid]

Re: Need some help to set up allocations.

Hello,

What should his allocations be set at. I have made a interfund transfer to 50% C and 50% G but what about his allocations what should they be set at?

How can I learn more about this, you people are experts and seem to change around your allocations all of the time to save and make money. I want to do this but have no clue how or who to ask for help.

Please help.

SKB

There are basically three ways to make money in stocks: 1.) stock picking; 2.) market timing; and 3.) asset allocation. Of course, #1 doesn’t apply to TSP. Most of the contributors to this board engage in #2, i.e. market timing. Therefore, if you’re interested in market timing, you’ve come to the right place. Finally, most academic studies assert that markets are efficient, you can’t consistently beat them, and that the primary determinant of portfolio success is #3, asset allocation.

Most experts recommend investing in the total stock market and then adjusting your level of risk with fixed income funds. A typical recommendation is: 60% stocks (47% C Fund, 13% S Fund) and 40% fixed income (20% G Fund, 20% F Fund). If you want to include international stocks (50% of world market capitalization and a good diversifier), then the international recommendation, because of currency risk, is 20-40% I Fund. Consequently, an allocation of average risk might be:

20% G Fund
20% F Fund
31% C Fund
11% S Fund
18% I Fund

Of course, the L Funds are also excellent investment vehicles. They provide asset allocation based on your investment horizon, e.g. years to retirement, automatic rebalancing, and adjustment for risk.

If you’re interested in a strategic asset allocation approach,i.e. asset allocation, buy and hold with periodic rebalancing, the following may be useful:

• The Vanguard Diehards forum: http://www.diehards.org/?ndays=10. The Diehards would be more than willing to suggest an asset allocation based on your need and ability to assume risk.
• The CoffeeHouse Investor: http://www.coffeehouseinvestor.com/.
• Financialengines: https://www.financialengines.com/FeContent?act=welcome. This is William Sharpe’s website. William Sharpe won the Nobel Prize. Amazingly, Finanacialengines offers asset allocation tools and advice to federal employees for free!
• Common Sense on Mutual Funds, John C. Bogel
• A Random Walk Down Wall Street, Burton G. Malkiel
• The Intelligent Asset Allocator, William Bernstein
• The Only Guide to a Winning Investment Strategy You’ll Ever Need, Larry E. Swedroe
• Asset Allocation, Roger Gibson. This book is my personal favorite. No nonsense asset allocation information - why and how.

Good luck!

 

[sunkissedbeach]

Re: Need some help to set up allocations.

Thanks to all that responded, I have signed up for the newsletter.
I still am at a loss on something.
The newsletter suggests Our current TSP Allocation is: and then it gives the percentages.
Am I to do interfund transfers for the amounts that they suggested and change the contributions to be the same.

or am I to simply change the contributions? eg. c xx%, I xx% F xx%?
I am still unsure of what I have read please someone clarify this for me.


SKB

 

[SkyPilot]

Re: Need some help to set up allocations.

Do both to be most effective, but primarily you will want to do an interfund transfer (an IFT).

Thanks to all that responded, I have signed up for the newsletter.
I still am at a loss on something.
The newsletter suggests Our current TSP Allocation is: and then it gives the percentages.
Am I to do interfund transfers for the amounts that they suggested and change the contributions to be the same.

or am I to simply change the contributions? eg. c xx%, I xx% F xx%?
I am still unsure of what I have read please someone clarify this for me.


SKB

 

[sunkissedbeach]

Re: Need some help to set up allocations.

So just to confirm.

I am to do an interfund transfer like this:

Example
C 20%
I 40%
F 30%
and set the allocations to match this.

That's was only 90%. You need 100% for an inter fund transfer! If you set contribution allocations to 100% G-fund, it's a place holder as Ocean states below, plus you know the amount and when it normally gets there. However there is no hard and fast rule, you can put it as you see fit!

 

[grandma]

Re: Need some help to set up allocations.

Hi Sunkissedbeach! Welcome - it always nice to have another female particpate in the information exchange; also the repartee, if you will -

 

[ocean]

Re: Need some help to set up allocations.

SKB,

Good to hear that you just signed up. I think you are in the good hands now. Tom (tspalk) is the site owner and I believe that he also will help you with all the legistic issues if you may have with the newsletter.

As far as the allocations, SkyPiolt is correct that you will concentrate on the Interfund Transfer (IFT). For example, if the newsletter said: G: 30%, F:20%, C: 20%; S: 10%; I: 30%. Just follow that and do your IFT. As for contributions, since it will change each time after your IFT, I would just leave it in 100% G fund as a placeholder.

Hope it helps

Ocean

 

[pyriel]

Re: Need some help to set up allocations.

Hello sunkissedbeach. First of all, i'd like to welcome you to tsptalk. You will learn alot from these people. They are very helpful, patient, and knowledgeable. No one here is going to tell you what to do with your investment but they will all be willing to share what worked for them and which lost them money. We are one big family here.

Stay with us and you will surely learn alot from them (not me;-).

P

 

[Birchtree]

Re: Need some help to set up allocations.

Welcome,

I have one of the simplest strategies on the board. I am 100% C fund and a firm believer in dollar cost averaging. My contribution allocation is set at 100% C fund also. I don't plan to do any IFTs until the C fund reaches a price of $17.00 and then the hunt begins. Just my style. Good luck.

 

[Spaf]

Re: Need some help to set up allocations.

SKB,
This is a repeat, but welcome aboard!

Excuse me but,
I'm suspicious that something is out of sync.

Are you looking to buy and hold for the next 15 years? or
Are you looking to get some market savy to become a trader?
What is your intention?

Also, Did you, sign up for the TSP Timing newsletter by Rev Shark?

Respectfully,
Spaf

 

[sunkissedbeach]

Re: Need some help to set up allocations.

Thanks everyone for all of the help and support. This site is fantastic!!

Well, my reason for coming here was wanting to find out what the best course of action for my husbands funds are. :worried:
I think it has done well lately as he was deployed overseas for six months and during that time he was not contributing to the TSP.
When he stopped contributing in December his balance was 99,519 and now he has been home for two months and back to contributing his balance is 108,247. While he was gone I never bothered to look at it. I was surprized how much it had grown since he had not been funding it for six months.
We really want to make sure that we can make the most out it by market timing.
Yes, I signed up for the newsletter and I will be following it there.

I will look forward to learning as much as I can about TSP and the stock market.

Thanks again all,
SKB

 

[sunkissedbeach]

Re: Need some help to set up allocations.

ok, another question,
When I see the IFT done on Monday will the balance change or will I just see less or more shares?

 

[Spaf]

Re: Need some help to set up allocations.

SKB,
OK! I understand now. You will be with us, and using the TSP News letter by Rev Shark! Also learning about Mr. Market.

See Miscellaneous Stuff forum and Members Introduction [Sticky: New Members - Start here] to set yourself up with an "Account" thread.

I'll do some minor editing of this thread and it will be your "Account Talk" thread.

If you run into any problems or questions give us a PM!....... ......OK
Regards
Spaf

 

[EW_ret]

Re: Need some help to set up allocations.

ok, another question,
When I see the IFT done on Monday will the balance change or will I just see less or more shares?

When you order an IFT before 12:00 pm EDT, that new allocation is performed at the days COB fund prices. Your total balance remains unchanged, and the shares in each fund changes according to your new allocation and each fund's share price set that day. You can see the changes the next day.

 

[sugarandspice]

Re: Sunkissedbeach Account Talk

........ you people are experts .........

Don't look at us here like this. I dont think anyone here considers his or her self an expert. There are some good people here with good strategies and there are numerous ways to go about using them. Once you get more familiar with the process of TSP then you will start to feel comfortable. And just my little piece " Never ride it out!" If it's falling get out as soon as you can so you don't have as far to climb up.

 

[sugarandspice]

Re: Sunkissedbeach Account Talk

Excuse Sugar for not saying welcome......She lacks social skills among other things.

 

[sunkissedbeach]

Re: Sunkissedbeach Account Talk

No problem thanks Sugar, ok experts not but well informed yes.
I wish to be well informed as well.
As it turns out on 08/25/2006 I lost some money in my C fund just over three hundred. If I had only seen this site a day earlier I would have saved myself the loss. I noticed that it was down by -4 from Aug 22.
I was set up with C Fund 50%, S Fund 25%, I Fund 25% for the last year or so. I changed it yesterday so I will see the changes tomorrow.
I had most of our money in the C fund but that is changed now as well.

In fact how do you not go crazy watching this so closely. G fund up +1 cent
F fund +1 cent C fund -4 cents, S fund -16 cents and I fund -21 cents.
I know this is supposed to be based over a long term but darn, the moment I take interest in this and pay more attention we are down by 470 dollars.


SKB

 

[sugarandspice]

Re: Sunkissedbeach Account Talk

Don't get caught up in in plus or minus every day. Yes it sucks to lose but if you look at long term and picking your spots with the best analysis you can(look at Fundsurfer's post in the I fund thread) you can hopefully minimize losses. Someone like Birchtree sits in the C fund and doesn't worry because he knows it will go up and down and he believes eventually that it will be up over time. And also when it is falling dont fall with it. There are days when you are on the sidelines(G fund) and everything loses but you won't. Losses will occur. You will have to absorb them but you don't have to like them and you certainly can minimize them. You could simply piggyback someone who has a good track record here but try to understand what people are using to make their moves. I pick a % and try to achieve that for the year. The main thing is that you are taking an ACTIVE INTEREST in your tsp future!

People here have lost 1000's of dollars over a 5 day period. Me being one of them. But there also the good days too.