TSP in the Early Days

[uscfanhawaii]

Good post uscfanhawaii. In 17 years I have never met anyone who would admit they swtched to FERS back in that day. I do know a couple who left govt service under CSRS but got their retirement contributions refunded so when they came back they were FERS. (I may not have that exactly right but they worked for the govt many years the second time and are under FERS)
PO

Stoplight also said he never heard of anyone who voluntarily switched back when FERS first came out! And I have only met one other. So I guess the 1 hundredth of a percent estimate is about right! I still get ribbed about it from my co-workers who never switched, but my TSP balance is WAY bigger than theirs. Difference is that it is gravy for the CSRS'ers, but for me it's my bread and butter!! :nuts:

 

[Stoplight]

Stoplight also said he never heard of anyone who voluntarily switched back when FERS first came out! And I have only met one other. So I guess the 1 hundredth of a percent estimate is about right! I still get ribbed about it from my co-workers who never switched, but my TSP balance is WAY bigger than theirs. Difference is that it is gravy for the CSRS'ers, but for me it's my bread and butter!! :nuts:

USCFan,

Your posts are excellent ! It sounds like you did all the right things, and things have worked out for you. I honestly never thought about the whole survivor/heirs issue differences, but for those with kids, that makes a difference !

I'm surprised none of the CSRSers have answered my question about paying in to Social Security. I guess most people worked their 40 quarters or whatever to qualify for SS anyway, before or after working for the Feds, but I would assume (and you know what they say about that !) that their earnings history, and thus, SS payment, would be lower.

Although I had no choice, I certainly think FERS ain't a bad deal ! Like you, I always contributed the max (except for the last few years), including catch-up. It scares me to death when I read about folks now who don't contribute to even get the match, and only take the 1% automatic...WAKE UP, PEOPLE ! It's FREE MONEY !!!
Of course, they are not reading a site like this anyway...

When I was crunching the numbers, trying to decide if I could "afford" to retire at age 57, I was curious to see how things stacked up between if I had been CSRS, vs. FERS....glutton for punishment, I guess Anyway, I came up with the following :

- My monthly FERS pension is approximately 55% of what my CSRS pension would've been.
- Add in the SS "Supplement" (until I reach age 62) and SS after I reach 62, and my monthly income is ~ 82% of my CSRS pension
- I had a little over $500K in the TSP when I retired, so withdrawal from that can easily make up the 18% difference, and then some !

I guess we've wandered from the OP's original topic, but the discussions have been interesting to me !


Stoplight...

 

[nnuut]

Don't forget that CSRS folks also have TSP, no matching but it should be counted as retirement income. I do get Social Security but it was cut 60% because I had less that 30 years, it's prorated starting at 20 years I only had 18.

 

[Stoplight]

Don't forget that CSRS folks also have TSP, no matching but it should be counted as retirement income. I do get Social Security but it was cut 60% because I had less that 30 years, it's prorated starting at 20 years I only had 18.

Nut,

Agree...

TSP, IF y'all chose to participate, right ? Sounds like a sweet deal to me !!!

All...I posted a continuation of this discussion over in the "Retirement" thread, for those inclined to continue following the discussion !


Stoplight...

 

[Rogue]

Excellent topic!

I also didn't know any CSRS'ers that it made sense to switch to FERS, provided they could work a few quarters after retirement doing something where they paid into SocSec.

I was in the military early '90s and didn't know anything about TSP. Was it even available to active duty back then?

In 1997/8 I was finishing up school and one of the GS11s where I interned said he made $40k just in his TSP that year!
I was blown away and convinced that TSP was the way to go.
I've never matched his performance. May 1998, my first boss told me that I should put in 5% the first day I was eligible (I think you had to wait a few months or maybe even a year then) or I was leaving "money on the table." He was great with poker metaphors. I give similar advice to all new hires these days.

It'd be interesting to see a timeline. I'm surprised that the G-fund was such a steady good performer in the 1980s.

Seems that S & I funds came out much later than youse-guys are remembering. I'm thinking maybe 2000 or so.
Looking it up....
OK, maybe Mid-2001 if my deductive reasoning skills are awake.

https://www.tsp.gov/investmentfunds/annual/annualReturns.shtml

* The returns shown reflect the actual performance of the S and I Funds for May 2001 and subsequent months. For the first four months of 2001 and for prior years, the returns shown for the S and I Funds reflect the performance of the Dow Jones U.S. Completion TSM Index and EAFE Index (without deduction of any administrative expenses, trading costs, or investment management fees), respectively.

C-fund was super lucrative from '95-'99. (click on the Individual Funds Tab https://www.tsp.gov/investmentfunds/annual/annualReturns.shtml ).

 

[InsaneZane1]

I was in the military early '90s and didn't know anything about TSP. Was it even available to active duty back then?
Seems that S & I funds came out much later than youse-guys are remembering. I'm thinking maybe 2000 or so.
Looking it up....
OK, maybe Mid-2001 if my deductive reasoning skills are awake.

https://www.tsp.gov/investmentfunds/annual/annualReturns.shtml

http://www.defense.gov/news/newsarticle.aspx?id=44767

According to the link above, the military TSP didn't become available until 10/9/2001. This makes sense because I hired on in 2000 and I know it wasn't available to the military when I got hired. I remember it becoming available to them after I had already started my civil service career. I do also remember the S and I Funds coming not too long after I hired on, so 2001 does indeed sound accurate for those options as well.

 

[Hallatauer]

What a flashback... been trying to remember my start with the guvmint and tsp. Aug 1987. GS-5 and perdiem. I signed the paper and being at the near bottom put down the minimum 1%. 3 months later made GS-7 but moved to an area with a high cost of living so left it alone. 2 years later made GS-9 so I upped it to 3%. Another year later GS-11 so again upped it... to 5% and full matching.. finally. Of course it was in the G Fund.

The jump to GS-12 I was all in with the full 10% and that increased as I eventually made GS-14 in 1992. This is when I started educating myself on investing.... I put money away for a down payment on a house and had a little to invest. Long term advice was to be in equities so moved 100% in to the C Fund and let it ride for years.

It took the gov't a few years to catch on to the internet but when tsp.gov arrived with unlimited transfers... it was a free for all for a while. TSPTalk followed which did wonders for giving everyone direction. Eventually that was the downfall of daily transfers as the volume scared the TSP Board.

Retired now and taking a monthly payment under 72t rules. I have a healthy balance and still monthy transfer following LMBF strategy. It has it ups and downs but has performed well. But as I get older I need to be more conservative with it.

All in all the TSP has been great and TSPTalk has been a phenomenal learning tool.