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Thread: FERs Retirees, anyone?

  1. #49

    Default Re: FERs Retirees, anyone?

    Quote Originally Posted by Cactus View Post
    Maricar19, I think Kave is talking about keeping 5 years of withdraws (living expenses) in the safety of the G Fund in retirement. I see many sites recommending that now. The idea is you invest the rest in riskier assets and in the case of a downturn you have 5 years to make that up because you are living off of the funds that didn't drop in value.

    In the TSP, of course, this is more of a psychological thing because it's all one pot of money and is paid out proportionately. I guess you have to rebalance it yourself every IFT/paycheck.
    Cactus, that is exactly what I am referring to. But I was thinking of rebalancing every 6 months or yearly even. Thanks!!

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  3. #50

    Default Re: FERs Retirees, anyone?

    Quote Originally Posted by Maricar19 View Post
    Hi Kave, based on Cactus' explanation, I doubt your withdrawals will be able to sustain your retirement fund on the G fund. If you leave it in the G fund, the only way to preserve and earn some, is to withdraw no more than 1.5% of your funds. Simple math will tell you to withdraw less than what you earn.
    The Wells Fargo calculator allows you to input more than 3 sources of income at different begin and end dates. It is good for TSP pensioners since if we retire before 62, we have the supplemental income, the FERS annuity, And TSP. You can also add SS at 62 pr whatever age you desire. This is also good if you have a military reserve component which starts at 60.
    Thanks Maricar19, for your help. Also, I will check out that calculator.

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  5. #51

    Default Re: FERs Retirees, anyone?

    Actually, keeping 5 years of living expense safe is a method that advisors now use to encourage us to take on more risk in retirement than they have historically recommended. Look at it this way. If you plan on having 20 years of income in your TSP that translates into keeping 25% in the G Fund. That's a third of what the L Fund allocates there. The L Fund is what we are encouraged to invest in during retirement.

    So, this is actually a way to increase the growth your TSP account during retirement. Yes, you won't make as much as putting everything into equities, but then you have no protection from another 2008 and in retirement you have no other income to make that up.
    Allocations as of COB Dec 28 : 100% S. | Retirement Date:Dec 2025
    Past Returns:
    2020 31.85%,2019 27.97%,2018 -3.36%,2017 13.10%, 2016 -1.79%, 5Yr Avg 12.61%

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  7. #52

    Default Re: FERs Retirees, anyone?

    Here is an article on 3 TSP surprises in retirement that I thought would be appropriate for this thread: 3 Quirks About the TSP in Retirement : FedSmith.com
    Allocations as of COB Dec 28 : 100% S. | Retirement Date:Dec 2025
    Past Returns:
    2020 31.85%,2019 27.97%,2018 -3.36%,2017 13.10%, 2016 -1.79%, 5Yr Avg 12.61%

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  9. #53

    Default Re: FERs Retirees, anyone?

    Quote Originally Posted by Cactus View Post
    Here is an article on 3 TSP surprises in retirement that I thought would be appropriate for this thread: 3 Quirks About the TSP in Retirement : FedSmith.com
    Excellent article, Cactus...thanks for posting !!!

    I factored in #1 and #2 in my retirement planning, but I was surprised to discover #3...after I retired !!! I thought we had some flexibility on which "pot" the monthly withdrawal actually came out of...


    Stoplight...
    "Too old to rock and roll...too young to die"... - I. Anderson

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  11. #54

    Default Re: FERs Retirees, anyone?

    Cactus, can you please give me some links on the subject below. I haven't come across topics about it. It is very interesting. It is contrary to most of my readings especially the one I just read (Ken Fisher). I would like to understand its logic so that I can safely "surf" during retirement...

    Quote Originally Posted by Cactus View Post
    Actually, keeping 5 years of living expense safe is a method that advisors now use to encourage us to take on more risk in retirement than they have historically recommended. Look at it this way. If you plan on having 20 years of income in your TSP that translates into keeping 25% in the G Fund. That's a third of what the L Fund allocates there. The L Fund is what we are encouraged to invest in during retirement.

    So, this is actually a way to increase the growth your TSP account during retirement. Yes, you won't make as much as putting everything into equities, but then you have no protection from another 2008 and in retirement you have no other income to make that up.
    Emotions should never play a role in one's investing strategy!
    No to Greed...No to Fear!
    http://share.robinhood.com/mariloc1


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  13. #55

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    Default Re: FERs Retirees, anyone?

    Very good. Thanks!

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  15. #56

    Default Re: FERs Retirees, anyone?

    Thanks Cactus. I have read this before more than once and for some foolish reason, i thought I know it by heart, but it never dawned on me the implications/complications of the withdrawal choices on the realities of life. I thought I had my TSP all planned out. i have an excel showing future monthly withdrawals and adjustments every 2-3 years. But I never thought of the possibility of changes midyear - emergency, unplanned super vacations, etc...I need to fine tune my tsp withdrawal plan!

    And I didn't realize about the proportionate distributions. I know about the impact on Roth and regular, but for an unknown reason, i always skipped reading the part "and from each TSP fund in which you have investments."

    Thanks Cactus.


    Quote Originally Posted by Cactus View Post
    Here is an article on 3 TSP surprises in retirement that I thought would be appropriate for this thread: 3 Quirks About the TSP in Retirement : FedSmith.com
    Emotions should never play a role in one's investing strategy!
    No to Greed...No to Fear!
    http://share.robinhood.com/mariloc1

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  17. #57

    Default Re: FERs Retirees, anyone?

    Proportionate distributions! Ugh!

    Sent from my XT907 using Tapatalk

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  19. #58

    Join Date
    Jun 2014
    Location
    Virginia
    Posts
    680

    Default Re: FERs Retirees, anyone?

    One more point about Quirk #3. You have no choice on when they take out your distribution each month.

    When I retired I received my first distribution around the 24th which means they take money out of my account around the 20th of every month.
    When I asked if they could change the date to the end of the month they said NO.

    I am not sure if it really matters but it is a weird time to withdraw. You would think it would be more efficient for them to do everyone's withdrawal at the end of the month and pay everyone at the same time.

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  21. #59

    Default Re: FERs Retirees, anyone?

    Quote Originally Posted by pmaloney View Post
    One more point about Quirk #3. You have no choice on when they take out your distribution each month.

    When I retired I received my first distribution around the 24th which means they take money out of my account around the 20th of every month.
    When I asked if they could change the date to the end of the month they said NO.

    I am not sure if it really matters but it is a weird time to withdraw. You would think it would be more efficient for them to do everyone's withdrawal at the end of the month and pay everyone at the same time.

    Any strategy that you use by knowing the date of withdrawal that you can offer? I mean, is this something that affects your IFT strategies ? If so, how and what would you recommend?

    Frank

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  23. #60

    Default Re: FERs Retirees, anyone?

    Pmaloney, after the 1st distribution, did it remain on the same cycle or did it change? Was this a monthly withdrawal,or a partial lumpsum?


    Quote Originally Posted by pmaloney View Post
    One more point about Quirk #3. You have no choice on when they take out your distribution each month.

    When I retired I received my first distribution around the 24th which means they take money out of my account around the 20th of every month.
    When I asked if they could change the date to the end of the month they said NO.
    Emotions should never play a role in one's investing strategy!
    No to Greed...No to Fear!
    http://share.robinhood.com/mariloc1

  24.  
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