Thread: I'm New at this, need advice

bklyngal wrote:

Does my new allocation make sense? I will not be retiring for another 17 years.

Welcome bkyngal!

With 17 years left, I'd say yes.

Thanks for your insight. I wish I din't have 17 years until retirement but i do. Since i am not all that financial savy i need confirmation that i am not really messing up.

With that many years left, an aggressive allocation is a good idea. However my layman's advice is to pay attention to it. You, like so many of us, left your sizeable account balance in the C fund for 3 years (2000-2003)while it headed down. How much more money would you have had (and I), if we had gotten into the G for even half of that time.

Dave

bklyngal, you have a very nice TSP balance:^. Some things you may want to consider when trying to come up with a TSP asset allocation. They include...how much risk am I comfortable taking on a day to day, week to week, month to month and year to year basis...how much risk do I need to take - you already have a good size TSP balance with 17 years to go, what need do you forsee for this money after you retire (will you even need to live on)...are you a buy and hold investor or a day trader...are you willing to accept the losses (in dollar terms, not percentages - 275K X 50% bear market loss, you are down to a $137,500 balance:X) that can occur with an all stock portfolio.

Static asset allocations are dangerous and useless. Just because you have 17 years until retire does not neccessarily mean you should be 100% equities in the TSP. Too many variables to assume that.

Good luck to you, AllexBancs

Hi Allex! Long time. :u

Hi Tom...took a little break from all of this but I am back. Glad to see the site has grown and you are still doing your thing. I see you have some "competition" with the TSP Pilot plan coming on board. Good luck to you and all other TSP investors:^:^

AllexBancs

bklyngal wrote:

Hi, I have been contributing to TSP for the last 12 years. I always had 100% in the c fund. My TSP balance is approximately 275K. Recently I moved 40% to S and 25% to I. I currently contribute 13k a year, and get 6.5k matching. Does my new allocation make sense? I will not be retiring for another 17 years. Thanks for all your help .

bklyngal and the rest of the gang,

Please smart ones, give me some guidance. My wife is a FERS employee contributing 14% (15% next year) and receiving matching contribution of 5%. Max contribution according to TSP is 13K (14K next year). We want to follow the latter but do not want to lose the 5% matching. Which one should we follow and please explain why.

As for me, I'm an active duty military contributing 9% (10% next year). I would like to do the same and max out to 14K next year. Which one can I follow? I've always thought I am limited only to 9 and 10%. What gives?

:*Heads spinning and seeing stars....

From what I understand, most people (buy and hold) recommend maximum equity exposure of 80% with 20% in fixed income/bonds. From the books I have read, the difference in returnbetween 80% and 100% equity is negligible over the long term, with the advantage of decreased volitility from your bond portion.

This is assuming that the TSP is your entire portfolio.

bklyngal

Did you really save 275K in your TSP account since 92'. Seems excessive--salariesand IRS limits were much lower then. No disrespect, but the C fund lost more than 40% between 2000 and 2002. Hard to re-coup in just 2 years.

MohammadXX wrote:

bklyngal

Did you really save 275K in your TSP account since 92'. Seems excessive--salariesand IRS limits were much lower then. No disrespect, but the C fund lost more than 40% between 2000 and 2002. Hard to re-coup in just 2 years.

MohammadXX, I have been in TSP since 1991. I am an atty for the federal gov't and have had salary that ranged from 60k+ in 1992 to 100K+ for the last 8years. My salary has allowed me to put the maximum in the last 8 years . W/ 5% matching I have put in in excess of 120K in the past 8 years. This year I was able to put in 13,000 w/ a match of 6500. In the 5 years prior I always put in the max. The C fund did great in the mid to late 90's. Had I moved the money in 200 to the g fund I would likely have had about 50K more. I am extremely lucky that I am well paid and able to put $$ in the TSP since my income is the "second income" in our home. Once the feds lift the percentages and allow those who can afford it to contribute the max, i think people will take great advantage of it. hope this answers your question.

bklyngal wrote:

MohammadXX wrote: MohammadXX, I have been in TSP since 1991. I am an atty for the federal gov't and have had salary that ranged from 60k+ in 1992 to 100K+ for the last 8years. My salary has allowed me to put the maximum in the last 8 years . W/ 5% matching I have put in in excess of 120K in the past 8 years. This year I was able to put in 13,000 w/ a match of 6500. In the 5 years prior I always put in the max. The C fund did great in the mid to late 90's. Had I moved the money in 200 to the g fund I would likely have had about 50K more. I am extremely lucky that I am well paid and able to put $$ in the TSP since my income is the "second income" in our home. Once the feds lift the percentages and allow those who can afford it to contribute the max, i think people will take great advantage of it. hope this answers your question.

BK, Now IC how you are able to max out and get the matching contribution as well. :iGlad to have you around. You are right, I can't wait for 2006...