TSP investors suspending contributions

[XL-entLady]

I think the majority of people on this MB who have suspended TSP contributions have done it to fund IRAs instead. In this economy it's nice to be able to have more financial control than 2 IFTs several hours prior to COB for the markets.

Lady

 

[JTH]

I think the majority of people on this MB who have suspended TSP contributions have done it to fund IRAs instead.

I'm one of them

 

[Frixxxx]

I think the majority of people on this MB who have suspended TSP contributions have done it to fund IRAs instead. In this economy it's nice to be able to have more financial control than 2 IFTs several hours prior to COB for the markets.

Lady

Right On Lady!

I don't think anybody "actively" on the board is still putting in more than the 5% to get the match.

I cut back on my % to invest elsewhere.

 

[CountryBoy]

I think the majority of people on this MB who have suspended TSP contributions have done it to fund IRAs instead. In this economy it's nice to be able to have more financial control than 2 IFTs several hours prior to COB for the markets.

Lady

I have halved my contributions to the TSP because the Board, who is supposedly looking out for our best interests, to fund ROTH's and 2 individual accounts, by purchasing dividend producing stocks. With only 2 IFT's the Board has forced us into the untenable position of losing money in this bear market or just sitting in the G Fund with negligible return, especially with the Feds move today. Things will only get worse, and the people who put us in this position are the ones trying to solve the problem. It's sad what lack of leadership we have, now and in the future.

If I had followed the Board's guidance, I would be down a minimum of $67K with only 4 years left to retire. I have managed to squeak out a little profit this year, more luck than skill. The ham handed leadership provided by Long, who even in the monthly minutes has admitted to losing money since the start of the 2 IFT limit, because of the lack of IFT's is limiting the possibility of increasing your retirement fund which also produces funds for everyone.

I am much better off investing myself and if they ever stopped the matching funds, the TSP would be just become a shell of itself. If given the opportunity to with my money without a penalty, I would in a heart beat. I firmly believe Long's objedctive is to destroy the TSP, because all his actions have been nothing but detrimental to us and the Fund.

CB

 

[XL-entLady]

I have halved my contributions to the TSP because the Board, who is supposedly looking out for our best interests, to fund ROTH's and 2 individual accounts, by purchasing dividend producing stocks. With only 2 IFT's the Board has forced us into the untenable position of losing money in this bear market or just sitting in the G Fund with negligible return, especially with the Feds move today. Things will only get worse, and the people who put us in this position are the ones trying to solve the problem. It's sad what lack of leadership we have, now and in the future.

If I had followed the Board's guidance, I would be down a minimum of $67K with only 4 years left to retire. I have managed to squeak out a little profit this year, more luck than skill. The ham handed leadership provided by Long, who even in the monthly minutes has admitted to losing money since the start of the 2 IFT limit, because of the lack of IFT's is limiting the possibility of increasing your retirement fund which also produces funds for everyone.

I am much better off investing myself and if they ever stopped the matching funds, the TSP would be decimated.

CB

Amen, CB. My spouse and I both retired from federal government and we are considering pulling one of our two TSP accounts and rolling it over into an IRA. It's impossible to make enough income to fund a long retired life with my huge medical bills and almost certain severe inflation in the economic future given the handcuffs that currently shackle our TSP accounts. :suspicious:

Lady

 

[Rod]

It's quite simple.

The Thrift Board has taken away our IFT freedoms.

They will say people have stopped contributing because of the recession. But, I say it's because of the extremely limited IFTs.

Bring back unlimited IFTs and contributions will increase.

-Rod

 

[Show-me]

Stephen,

A lack of inter fund transfers and being force to buy and hold or stand on the side line for a month while missing massive swings in the market to trade off of. A lack of having a voice in TSP. A lack of the FRTIB offering a Roth TSP while 30% of the private sector is offering it. A total lack of service from the TSP and Scottrade got my business. Hell, the G fund only pays 2.75% and you can get a online bank to pay up to 3.5% on my money.

http://savingsaccounts.com/

 

[JTH]

Hi Steve

My decision to stop contributing to the TSP had nothing to do with our current state of the economy. When the board decided to impose IFT limitations, my account became crippled and like others, I started losing money. I did not feel it was fair for them to change the rules after I had already invested thousands of dollars. I also considered the fact that as a military member, my contributions do not receive matching funds.

So I opened a ROTH IRA and no longer have to deal with IFT limitations or settling for End of Day prices. With a greater variety of ETFs and Stocks to choose from, setting stops and limits, I have more tools in my arsenal to protect my money.

Cheers...

 

[wv-girl]

Stephen,

A lack of inter fund transfers and being force to buy and hold or stand on the side line for a month while missing massive swings in the market to trade off of. A lack of having a voice in TSP. A lack of the FRTIB offering a Roth TSP while 30% of the private sector is offering it. A total lack of service from the TSP and Scottrade got my business. Hell, the G fund only pays 2.75% and you can get a online bank to pay up to 3.5% on my money.

http://savingsaccounts.com/

Hi Show-me,
Thinking about opening a Scottrade acct also, but have noticed several different levels of trading platforms. Any recommendations?
Thanks

 

[McDuck]

Bring back unlimited IFTs and contributions will increase.

Right On !

I use to contribution 10%, then after the IFT limits I dropped back to 5% (the minimum to still get the matching funds).

 

[Silverbird]

People are really confused. Recently, I find new TSP members spreading their investments over all of the L funds and in G, F, S, C, and I. Obviously this is not what the L funds are for, L funds are being wrongly used, where is the education?

Big losses also have caused people to pull and run to G, and if you didn't pull back in first or second quarter, you just lost a bundle.

Although you're talking about tax-free dollars, TSP is not an especially good investment except for matching funds, at least until stocks start to show recovery. Doubly so if you have home equity loans or lowering balance available and rising interest credit cards, or need cash to buy something you usually would pay installments for - like a car, or in my case, a dishwasher since my current one failed.

 

[Rod]

People are really confused. Recently, I find new TSP members spreading their investments over all of the L funds and in G, F, S, C, and I. Obviously this is not what the L funds are for, L funds are being wrongly used, where is the education?

These folks have to educate themselves. They are blindly diversifying their funds, and will get burnt.

As I discussed elsewhere, if you are confused you need to simply remain in (G) until you educate and empower yourself to responsibly invest in the TSP.

-Rod

 

[Mike]

Offering up easily accessible educational courses on TSP funds and investing in general would do a world of good. While I agree with Rod that people "should educate themselves", the simple fact of the matter is most of them fail to do that. Maybe it's because they fear the complexity of the stock market, maybe it's due to lack of interest, or maybe it's due to laziness. Whatever the reason, most federal employees (and I would guess most people in general) are woefully uninformed when it comes to investing.

 

[PessOptimist]

Since I got interested in trying to manage my TSP account, I have mentioned to coworkers that they should check out their account. Most do not know that they can go to tsp.gov and find answers. Most, do not know how to access their account, have never gotten a password and don't seem to know where their statements are. Some ask if they will get in trouble accessing the account at work. Some of these same people have no problem spending hours at work on my space or youtube.

I am not saying that the tsp.gov website is perfect, but it does explain the funds and show you where your money is going.

There are a lot of e-mails coming in to my agency about TSP and how to access it, reminders about the max contributions, changes, etc. There is no reasonable need for courses about how to use TSP. Unless you are in a position to get promoted and design/teach the course. The info is all available on line and most agencies send reminder e-mails about how to get there.

If fed employees would concentrate on the J.O.B and the their future instead of who got the promotion and what the employees association is doing next, the problem wouldn't exist.

 

[Show-me]

Still now contact list for ETAC on the homepage, they don't want to be bothered. Love that representation, almost as bad as the government.

 

[XL-entLady]

Offering up easily accessible educational courses on TSP funds and investing in general would do a world of good. While I agree with Rod that people "should educate themselves", the simple fact of the matter is most of them fail to do that. Maybe it's because they fear the complexity of the stock market, maybe it's due to lack of interest, or maybe it's due to laziness. Whatever the reason, most federal employees (and I would guess most people in general) are woefully uninformed when it comes to investing.

I know things differ from agency to agency, but my former agency (I'm retired) never mentioned the TSP. If we saw a TSP email it was a very occasional piece of spam that got through the junk mail filter. When I first started trying to educate myself I wasn't sure where to even start. That's why I had (still have ) some black holes in my knowledge base, even though I have a business and accounting background. Most people in my former agency don't even think about their TSP accounts. Sad.

Lady

 

[peterson82]

Considering my retirement is eons away, I have increased my contribution %!

 

[Frixxxx]

Considering my retirement is eons away, I have increased my contribution %!

Nice, DCA in your positions....I have a few years myself, but decided diversification would suit me better right now. I have two old 401k plans that I get to choose investment placements. That freedom keeps me out of the 5+% for TSP contirbutions. But, I get the wonderful tax right-offs still.

 

[OBGibby]

I increased my TSP contributions, partly because of the weakening economy/cheaper stock prices.

I have NO sympathy for federal employees who don't take an active part in their own retirement (or any worker for that matter). Like most things in life, proper planning prevents **** poor performance (6 P's to live by!), and TSP or any other retirement accounts is no exception.

There is more than enough information online about retirement and the TSP - you can only take the horse to the water, you can't make 'em drink.

As far as opining about why folks stopped contributing to the TSP, I think the overwhelming majority of employees who stopped contributing were/are experiencing financial difficulties (like a lot of people in the current economy), and scaled back their spending. TSP contributions are "expenses" and some folks simply couldn't afford to pay for something that pays off in the future (for some people, in the way off future), when they have financial obligations that are due in the here and now. I think the percentage of TSP participants who used to actively trade prior to the IFT restrictions were enacted were a very small percentage of TSP participants, as such, I think the number of TSP participants who recently quit the TSP as a result is even smaller.

Just my two cents - your mileage may vary.

 

[XL-entLady]

.... I have NO sympathy for federal employees who don't take an active part in their own retirement (or any worker for that matter). Like most things in life, proper planning prevents **** poor performance (6 P's to live by!), and TSP or any other retirement accounts is no exception.

There is more than enough information online about retirement and the TSP - you can only take the horse to the water, you can't make 'em drink....

Just my two cents - your mileage may vary.

Interesting opinion, OBGibby. I guess opinions are like noses; everybody has at least one. :cheesy:

While I agree that every federal employee has the responsibility to become as informed as possible about his/her retirement, I'm not quite in line with your statement about there being more than enough information online to do that job. Especially when the sketchy online TSP Fund investing information only reflects one viewpoint, that of buy-and-hold and "L Funds are best." Ask just about anyone how that strategy has been working for them this year. :blink:

And the HR people in my former agency are instructed to mention the party line viewpoint (B&H and LFunds) during new employee orientations. So if your agency officially tells you this is what you're supposed to do and you already have more duties than you have hours in the day, it is human nature to trust the instructions.

I absolutely agree with you that the majority of people who have lowered or suspended contributions have done it because of personal economic hardship. However, I also firmly believe that anyone who does as you advise and becomes informed about the TSP system and its pluses and minuses will put enough in their TSP accounts to receive their 5% matching and that's all. They will then put any additional spare dollars into an IRA or other instrument that can actually make some money in this bear market economy.

I'm just glad that I found this MB, and I tell every federal employee and retiree I know so that they, too, have the choice of informed and intelligent alternatives to the party line.

Lady