the 'T' fund, would you?

[burrocrat]

http://www.msn.com/en-us/money/retirement/its-sleazy-its-totally-illegal-yet-it-could-become-the-future-of-retirement/ar-AAeSLtt?ocid=spartanntp

Tontines, you see, operate on a morbid principle: You buy into a tontine alongside many other investors. The entire group is paid at regular intervals. The key twist: As your fellow investors die, their share of the payout gets redistributed to the remaining survivors. In a tontine, the longer you live, the larger your profits — but you are profiting precisely off other people’s deaths.

now that tsp.gov is legally authorized and considering offering different investing options such as an environmental fund or other socially conscious investing options, if they were to offer a 'T' fund (tontine), would you invest in it?

 

[RealMoneyIssues]

No

 

[alevin]

sounds similar to the farm-family trust fund existing situation an old friend described to me a week or so ago, set up by his parents. Survivor siblings split the farm income, increasing shares proportionately as the sibling pool gradually shrinks, until the last surviving sibling gets it all, at which point the survivor's children inherit the whole shebang, whatever is left to sell off.

My friend doesn't like the survivor's inheritors' take-all scenario, the 3d generation has no physical investment in the farm, never has had, don't appreciate what they would be receiving. the second generation (the siblings) did put sweat equity as well as emotional investment into the farm while growing up. Friend is planning to propose to siblings that they go ahead, sell the farm now and split the proceeds among all the siblings (second generation) and profit fully and directly from their inheritance-equally, instead of engaging in life-expectancy speculations among the siblings and lack of sweat-equity investment among the 3d generation. TSP T fund would be logistical nightmare. constantly shifting pool of fish, incoming and outgoing.

 

[Intrepid_Timer]

Let me increase my home security and buy more guns first.................

 

[Cactus]

That's weird. It sort of sounds like an annuity. :notrust: Are there limits to taking your money out? What's to prevent me from selling all my shares the minute I'm diagnosed with pancreatic cancer or something like that? It seams you only lose if you die unexpectedly like in an auto crash. Then it's only your heirs that are left out in the cold. Still, it doesn't sound like you would make that much from peoples deaths. Plus I'd be afraid they'd think I'm dead and take all my money.

 

[burrocrat]

i think it works like a closed-end fund/pool, everybody puts the same amount in at the beginning and there are monthly withdrawals of a set total amount that get divided by the number of remaining investors. the more that die, the more each of the survivors get each time the payout is distributed.

i was considering i might do something like this if the option was available, but then i remembered so many tsp investors live super conservative lifestyles and are unlikely to die before me. also, some of you are so damn stubborn you'll never die.

 

[Intrepid_Timer]

i think it works like a closed-end fund/pool, everybody puts the same amount in at the beginning and there are monthly withdrawals of a set total amount that get divided by the number of remaining investors. the more that die, the more each of the survivors get each time the payout is distributed.

i was considering i might do something like this if the option was available, but then i remembered so many tsp investors live super conservative lifestyles and are unlikely to die before me. also, some of you are so damn stubborn you'll never die.

I'm being buried in a piano case and taking it with me!!

 

[FogSailing]

In some sick peculiar way the whole thing reminds me of Soylent Green...

View attachment 35391

Charlton Heston: It's people..

FS

 

[nnuut]

Could result in a few assassinations!

 

[Cactus]

I'm being buried in a piano case and taking it with me!!

Are you sure the piano case would be big enough for the both of you? I understand they don't print those large denomination bills any more. You'll have to convert it all into something like diamonds for it to be in a small enough package to take with you.