Thread: L fund? New guy

L funds are like that counter top oven on those infomercials -> Set it and Forget it. The one you pick is based on acceptable risk.

Like any investment you have to set goals and determine if that investment will help you attain it. If you want to make a million dollars (nice round number) you can see what the projected gains will be on your investment strategy. If the amount you put in and the return on that investment equals $1,000,000.00 when you get to say 62 (guess), then you hit your goal!

If you look at the helpful links on personal finance on the main page, it will provide you valuable insight!

My personal rule:

Invest to win, invest to play, but never throw your money away!

BTW welcome to the boards!

Welcome to our forums. You can join the Automated Tracker once you have 10 posts. Read the Automated Tracker Rules in my signature. Its still in testing by our members, but its working and tracking member fund transfers and allocations. Click Members Ranking to see the current rankings.

The Lifecycle funds are a good choice for those who do not have the time to manage their retirement account. If you are young the L2040 is a great choice for a "set and forget" choice. Many of our members want to do better. They take the time to learn how to mange their own TSP accounts. Some use one our TSP services.

We have TSP services that tell you when to transfer between your TSP funds. Several of these services are free for now, but will likely become paid services soon. These are the TSP Trader System and the EbbChart Trading System. We have another paid service TSP Timing Newsletter Information that is managed by a professional trader Rev Shark. We have a lot to offer at TSPTalk. Just spend some time to browse our forums, and learn a few things.

Originally Posted by darwat

I am very young and just started investing into the tsp? Is L fund the right choice for me?

Welcome to the mb!!! IMO, L fund you bet. If your just starting out and are on the learning curve or don't want to mess with learning or watching the market every single stinking day the L fund will work nice. Or you can come up with a buy and hold ratio yourself.

The biggest thing you can do to make the most of your retirement, as a newbie, is to jack up your contributions until you think your going to bleed internally from starvation. I'm just kidding about the bleeding and starving part.

I know it suck to be young, full of life and on a tight budget throwing tons of perfectly good wine, women and song money at your TSP, but the end result will blow you away. I wished I did more.

And, all of us old folks are going to suck the life out of one of your "three legs of retirement".........Social Security.

Be prepared and get crack'n. Again, welcome and ask questions.

Darwat, welcome!
Norman

Darwat:

Welcome.

Here is a good read for new employees just starting in TSP.

http://www.tsptalk.com/mb/showthread.php?t=3629

Read that, and in the second message on that thread, you'll see a discussion about using the L2040 as your initial investment vehicle while you begin, learn, and until you want to venture out into other funds.

Yes, by all means, the L funds are a great place to start, if you are not sure where you want to put your money. it's a good "autopilot" until you decide you want some adventure on your own.

Please read that thread, and then hang on for a great future.

L fund invests heavily in C. I know C desn't pay as well as I. Is C much safer than S or I?

Originally Posted by darwat

I am very young and just started investing into the tsp? Is L fund the right choice for me?

Welcome!

The L fund is a good place to start. However, you owe it to yourself to develop basic understanding of the TSP and the available funds so you can maximize your returns as soon as possible. These early years are very important, as these dollars will be the most valuable and you can usually tolerate the most risk at younger age.

As far as risk, the I fund is usually thought to be more volatile than the S fund, and the S more than the C fund. However, risk and reward potential seem to run in tandem. The last few years, the I fund has done very well vs S and C, but that is not always true or a given. Look at the historical returns on the TSP site...

Calculate how much you will need and when you will need it, then adjust your investment profile accordingly. There is a wealth of information on this site if you are interested in digging for it. Also, as you become more adept, ask specific questions and you will find a generous and enthusiastic response from those who post here.

Good luck!

NO!!! Read Jim Cramer's book Stay Mad For Life. You need to play it risky since you are young. Stay away from the F and G funds. I put 45 in the I, 30 in the S and 20 in the C...just switched it not to long ago. You will have good days and bad days. But let it sit there, whatever percentage you choose. I have moved mine all over the place but I think it's in it's resting place for awhile. I just started the TSP this year and I am 30...putting 10% away. I am down a little but that's my own fault because I moved my money too much. I have a better understanding since I moved to "Cramerica" and took his advice. You have to be patient. It's a waiting game. I also just got into stocks...you have to take time to research what you want to invest in. Probably by the middle of the year 10% will be going to TSP and $150 will come out of my pay each month and into my ING Sharebuilder account. Remember, all the money you put away is tax free until you withdraw it. It will (or should) put you in a lower tax bracket. What's nice is I am active duty and when we get the pay raises it comes off the top and you don't even notice that you got a raise...think of it in that aspect too. I have a little over 10 years in and saved $3k this year, but all that will compound over time...just think of that as a base $3k a year for 10 years, not to include pay raises, the market going up...$30k as a minimum but should be closer to $80...that's what I am realistically hoping for. When you retire and if you don't go civil service (which they give up to 5% of your contributions, so I have heard), roll it over to an IRA, not a Roth...you will have too much money. You can also set up your portfolio in an IRA. Wow, didn't mean to type that much but I hope that helps some...but do yourself a favor, stay away from the F, G and L funds since you are young...you will have very little growth compared to what you could have. The only way the L fund is good is if you just want to put money away and if you don't have time to follow the market. If you put some time in, you won't regret it.

Originally Posted by darwat

I am very young and just started investing into the tsp? Is L fund the right choice for me?

All you really need is a blindfold and a monkey with some darts. You will probably outperform most TSPers. Oh yeah, have you checked out any of the premium services?

Darwat,

Since you asked, Yes. Sounds like the best place for you to park your money for now.

Great link here.

Originally Posted by James48843

Here is a good read for new employees just starting in TSP.
http://www.tsptalk.com/mb/showthread.php?t=3629
Please read that thread, and then hang on for a great future.

Originally Posted by darwat

I am very young and just started investing into the tsp? Is L fund the right choice for me?

Yes! L 2040. Set and forget. -----Jim