Thread: The Problem with TSP

From the public policy perspective, it would make sense for the government to provide some sort of guidance to its employees when it comes to investing so that they don't become a future drain on entitlement programs such as social security (I have seen postings for seminars once in awhile, but they are not very well publicized so I don't think very many people ever see them and take advantage of the opportunity). Clearly, it's in the best interest of all involved for federal workers to do well with their retirement accounts. However, the government doesn't always take the best course of action, and in this case, takes the worst course of action - by doing little to nothing to educate its employees and by punishing those who try to do that (at least if they try to do it on government time).

With all that said though, it's also an issue of personal responsibility. If people are having thousands witheld from their checks for the TSP, the onus is on them to learn how to manage that money so that it grows over time and provides them with some sort of a comfortable retirement. Failing to take this responsibility is worse than buying a new car without researching it or buying a house without checking around for good deals / rates, etc.

As for the "retirement educators" out there, my main suggestion is to steer clear of doing it while on the job or on a government computer. Just spread things via word-of-mouth and tell people to check it out on their own time. It obviously wouldn't be quite as effective as mandatory investment seminars for federal employees, but it's better than nothing.

Spaf:

I don't think there is a conspiracy theory against TSP investors, if that is what you are implying.

Regarding "Websense": The union has an agreement that management cannot monitorwhat webpagesthat individuals are viewing, however, (as I understand it) they are allowed to keep a log of web addresses viewed by all andblock anything that they think is non-work related. That is what they use "Websense" for.After blocking a web page, it can be 'unblocked'onlyif an individual requests it, but that individual must demonstrate why the page is acceptable for use on a government computer.

That said, I am disappointed that Tom did not bring his suspension to the union, but I also do not know the details involved.

I agree withMike: its an "an issue of personal responsibility." I only have 14 years of government service, but I have noticed one thing about typical government employees: they would sacrifice gain (because it has risk)for security. Most looked at this new TSP system and asked "How can I not lose ANY money?" rather than "How can I make the most money?"

It is probably the newer employees who are discovering the advantages of managing their TSP, with a sprinkling of older employees, (who maybe have outside investments and thus were able to look at TSP differently) but I don't have figures to prove that.

Now you want conspiracy theories, how about the "L" Fund? Its tough enough having 5 different funds to move money around in, why increase the odds with another?

Regarding the L fund. Another conspiracy? I am guessing that since mostFERS employeesare sitting in the G fund, this is a move by the Gov. to counter criticism as FERS employees begin to retire with only a paltry sum. The L fund will stand as the gov. attempt tomotivate employees diversify and move more into stocks, and if they don't, then that will be their own fault. This may be a grand game of CYA, and an attempt to forestall demands to modify FERS to include a stronger pension component more like CSRS which was guaranteed, and for the average empoyee a stronger system, especially those who now sit in the G fund. Of course, I could be totally paranoid, and this is just the altruistic efforts of a benevolent employer :P.

How do we know where people have their funds invested? Does it say anywhere on the tsp-site, for instance? How many dollars are in each fund?

I have never heard of any problem in using a govt computer, unless it be to a triple-x site. It all comes under the heading of "maintaining proficiency."

Dave

This link should take you to the report that should answer most of the information you are asking about regardinf amounts invested in various TSP funds.

http://www.tsp.gov/forms/financial-stmt.pdf

Yeah, TSP released a distribution report under a "highlights" deal on their website awhile back. About half the TSP money was in G, 40% or so was in C, and the remaining pittance was split between S and I.

Hey, thanks. A new statement will be coming out in the spring, it looks like. As of last year, $128 billion invested, $58 Billion in the G-fund.

I stayed 100% in the G-fund for a long time; I just didn't want them taking money away from me, heh. I still use the G-fund as a sea-anchor, to mitigate losses. Currently I am 60% in the market which is where I am comfortable. My goal is to raise the ratio of TSP to gross income, which currently stands around 2-1, up to around 4-1 when I retire.

Dave

I agree that the government should make some kind or retirement/TSP training a priority, especially for new employees. While training was not offered, I spoke to our personnel office recently about setting up a training. They were actually very supportive, and said that they used to hold such trainings, but no one had expressed interest in some time, so they stopped. I had already done an informal poll of my coworkers, and could guaruntee the personnel office that at least a dozen staff were interested. With that, they agreed to set up a training early next year. So, I would recommend that anyone who wants such a training for themselves or their coworkers call their personnel offices, you might be pleasantly surprised.

Our training will likely be conducted by a private company that holds such trainings around the country. I will post a review in case anyone wants to use them in the future.

Happy New Year!

Dave

Dave M wrote:

As of last year, $128 billion invested, $58 Billion in the G-fund.

I have wondered how much money was made in this group as a whole. I mean, if some or most of you had a large chunk in theG fund when you started here and you jumped over to the stock funds and obviously made higher gains than if you stayed in the G fund,how much will that $128 billion go up in the next Highlights newsletter because of our market gains? I doubt it's in the billions but I would bet it's in the tens of millions.

2000 to 3000 members withI'm guessingan average gain of about 5 to $10,000 each =$10,000,000 to $30,000,000 :*

We may have pushed the S&P up $1 this year ourselves :u