Thread: Newer Newbie Question....

OK, I let my adult ADD get the best of me before reading the rest of the messsageboards.

I guess it "IS" the next day. To bad there isn't a delete feature so I wouldn't embarrass myself like this.

Originally Posted by EhhMon

OK, I let my adult ADD get the best of me before reading the rest of the messsageboards.

I guess it "IS" the next day. To bad there isn't a delete feature so I wouldn't embarrass myself like this.

EhhMon,
No embarrassment! We all started with the same question!.....

Welcome, my friend!.....
Spaf

Originally Posted by EhhMon

OK, I let my adult ADD get the best of me before reading the rest of the messsageboards.

I guess it "IS" the next day. To bad there isn't a delete feature so I wouldn't embarrass myself like this.

No such thing as a dumb question. We are more than happy to answer any questions you may have.

Welcome!

BTW, look at your reason for editing your post.

Originally Posted by EhhMon

I guess it "IS" the next day. To bad there isn't a delete feature so I wouldn't embarrass myself like this.

You're not alone by any means EhhMon. Top 2 questions I receive via email from new readers:

1) When I make a transfer how long does it take to take affect?

2) When you make an interfund transfer, do you also make a contribution allocation change?

Answers: (gives me an excuse to point out the FAQ page)

1) http://www.tsptalk.com/faq.html#6

2) http://www.tsptalk.com/faq.html#5

Well I'm glad that there are folks here who don't mind ,, errr ,, less than well informed questions.

I've been blindly following the TSP Allocations for a couple've years and in scanning thru the returns it seems that I may do better following another strategy but WHAT TO DO???

Unfortunately I don't have much time to become as savvy as my engineer's mind would like and usually in that case I swing the other way and depend on good folks like yourselves. I just joined the premium service in hopes of getting a better return but noticed that the survey performance is best so far for 2007 (don't understand how to follow if the ratio isn't to date).

I know that there are many factors to consider but I'm 7 years from my MRA and have a chunk of change in my account. Any suggestions? ...please ....please!

Bob465,
All traders need to be savvy!...Real savvy!
You can learn if you would like? This is a great place!
However, I wouldn't risk loosing any retirement $, as close as you are!
Sit in the appropriate L-fund, at TSP.
When you feel you are comfortable with trading strategies, you might stick a toe in the water.
When you get near retirement capital preservation becomes a more concerning issue.
Regards
Spaf

Bob465, another question to ask yourself is if you will need to access your retirement funds right away.

Some will not need the funds for several years after the date they separate from fed employment. Therefore, if you have this advantage, you may have more years until you reach that "need" horizon, thus greater flexibility with your risk tolerance and how aggressive you can be.

Originally Posted by SkyPilot

Bob465, another question to ask yourself is if you will need to access your retirement funds right away.

Some will not need the funds for several years after the date they separate from fed employment. Therefore, if you have this advantage, you may have more years until you reach that "need" horizon, thus greater flexibility with your risk tolerance and how aggressive you can be.

That's pretty much my plan as well, to tap into my personal savings and Roth IRA contributions (and eventually earnings) when I retire at 57, and don't touch the TSP until everything else is exhausted.

Most withdrawal strategies recommend taping the Roth IRA last. This allows tax free compounding. The TSP and Tradition IRA accounts must have withdrawals art age 70 1/2. The recommended withdrawal strategy for most is first taxable investments/savings, 401k/Traditional IRAs, and Roth IRAs.

Originally Posted by VirginiaBob

That's pretty much my plan as well, to tap into my personal savings and Roth IRA contributions (and eventually earnings) when I retire at 57, and don't touch the TSP until everything else is exhausted.

I'm retired and don't need to withdraw from my TSP account, or other investments. I could take on more risk in my investments but have not by choice. I found myself getting more conservative as my retirement date approached. Since I do not need the income from investments, I do not need to take on more risk than 40% equities, and 60% bonds/cash.

The danger in taking a trading approach is not following the strategy you lay out for buying and selling. Because we a human we have emotions which bias our daily trading. It’s because of these emotions that many fail to beat the market in the long run. The passive approach of maintaining a fixed allocation among the funds, or an L fund, works because the strategy remains constant, and emotions are removed. Of course, this is just my opinion based upon my own experiences.
You should have an investment strategy, and stick to it, regardless of world events, or interest rates, or what others are doing.

EWGuy,

Points well made...

For those contemplating retirement and using a "buy and hold" strategy; watch out for major corrections, e.g., 2000-2003.

Another bear market may arrive when it can hurt the most. For the retiree, a strategy that does not allow for a "safe harbor" scenario may wreak havoc and disaster.

An L fund will not care, but will ride the market all the way down. As the retiree is no longer making contributions, this will not even allow for DCA.

The question will be, can one afford to just "ride it out"? Maybe so... Maybe not.

Good luck and prosperity....

I agree we should avoid bear markets if at all possible. In hindsight, they are recognized but when they start is difficult to determine. At what point in a market correction should you bail on equities? When should you jump back in the market? These are questions we try to answer.