Page 1 of 3 123 LastLast
Results 1 to 12 of 33

Thread: Post Your Total Annualized Rate of Return

  1. #1

    Question Post Your Total Annualized Rate of Return

    I was looking over my 2013 Annual Statement this weekend when I noticed that my Lifetime TSP Contributions were about half of my Ending Balance. I knew from the quick and dirty rule-of-72 that my money would double in 10 years at 7%, but I've been with the government over twice that so I'm making less than 3.5%. That is just pathetic.

    Then it occurred to me that this is only the case if I had plunked the contributions down at the start and contributed nothing since then. That is the opposite of what I, and most people, do. We start with nothing and make contributions every paycheck. How much? Well that varies over time for most of us as our contributions go up with cost of living increases, step increases, and promotions. But, as a first step approximation I decided to divide my Lifetime TSP Contributions evenly over my entire government career and see how that affected my return. You can use the TSP How Much Will My Savings Grow Calculator, but I used the Growth + Contributions Calculator in the attached spreadsheet to come up with these gains for select years and growth rates:

    Table1: Gain at X Annual Growth rate After Y Years
    Years 4% 5% 6% 7% 8% 9% 10%
    5 10.4% 13.1% 16.0% 18.8% 21.8% 24.8% 27.9%
    10 22.4% 28.8% 35.6% 42.8% 50.4% 58.4% 66.9%
    15 36.0% 47.3% 59.6% 73.1% 87.9% 104.1% 121.8%
    20 51.7% 69.3% 89.2% 111.8% 137.5% 166.7% 199.9%
    25 69.8% 95.5% 125.7% 161.4% 203.5% 253.2% 312.0%
    30 90.5% 126.7% 171.0% 225.3% 291.9% 373.7% 474.2%

    You can zero in on your personal return rate by modifying the Annual Growth Rate until it matches your return, but I found it easier to create the Growth Rate Calculator in the attached spreasheet. I just entered my contributions, balance, and years of service and came out to 5.5%. Yeah, not great but better than 3.5%.

    Again, this assumes you didn't start with anything and have the same fixed contributions throughout your career. If you use the calculator on the TSP site you can add a percentage contribution increase to get an even more accurate result, assuming you've kept records of how much your contributions have increased over the years.


    My Total Annualized Rate of Return: 5.5% @ 23.5 years.
    Attached Files Attached Files
    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%


  2.  
  3. #2

    Join Date
    Oct 2008
    Location
    Stinking desert valley of bad air quality, AZ
    Posts
    2,993

    Default Re: Post Your Total Annualized Rate of Return

    Geez Cactaceae person, I just this morning got back to your risk/CAGR/Total Return spread sheets and trying to come up with a better return figure for years before 2007. Now this? Now I gotta figure out what the cactus meant to say in the returns calculator? I'll study on it. Thanks for posting it.

    PO

  4.  
  5. #3

    Join Date
    Aug 2008
    Location
    Pensacola, FL
    Posts
    6,312

    Default Re: Post Your Total Annualized Rate of Return

    I'm not very good with math. Can someone help me. Let's use round numbers for ease of calculation.
    If my lifetime contribution is $20,000 and my balance is $40,000 and I've only been working 5 years....what is my average annual rate of return? Would it be 10% (50%/5yrs)?

  6.  
  7. #4

    Join Date
    Aug 2008
    Location
    Pensacola, FL
    Posts
    6,312

    Default Re: Post Your Total Annualized Rate of Return

    Wait, it should be 100%/5=20% right?

  8.  
  9. #5

    Join Date
    Mar 2006
    Location
    Raleigh, NC
    Posts
    3,416

    Default Re: Post Your Total Annualized Rate of Return

    Cactus,

    Personally, I was an idiot before 1994. It was actually the Great Grandee Clinton tax code change that woke my lethargic butt up. I got promoted, had a very special - and expensive wet-down - where I spent my take home pay increase, and actually lost $50. That is what President Clinton did to me!!! I was so happy I learned how to play the tax game - and it has done me well in my TSP account...

    Anyway, if you were anything like me, than your first years were a waste. I didn't even contribute. The only thing going into my TSP account for my first five years was the 1% the gubmint dumps into their 'G Fund' slush fund. So, should I - probably we - include those years we were not really investing in the equation. Me not think so. My guess is your returns are significantly better once you took things seriously...

    But, lest anyone gets too happy, I think the 'Your Contributions' number does not include the match. The difference between this year's number and last year's seems to be my personal contribution. So, for most of us (those that contribute at least 5%) you will have to multiply that number by 1.5. Oh well. Not certain though...
    Lookin' up at the 'G Fund'!!!

  10.  
  11. #6

    Default Re: Post Your Total Annualized Rate of Return

    My Total Annualized Rate of Return: 2.94% @ 23 years.

  12.  
  13. #7

    Join Date
    Feb 2011
    Location
    Washington
    Posts
    9,583

    Default Re: Post Your Total Annualized Rate of Return

    Delete, missed the "annualized"

    Will have to figure that one out... brb
    Rules:
    - Trade what you see, not what you believe
    - Don't put stuff in your signature that a Mod doesn't like

    "Government exists to protect all people’s rights, not some people’s feelings." - A. Barton Hinkle

    Great Tools:
    http://www.CreditKarma.com
    http://www.Mint.com
    http://www.SaveUp.com/r/nmJ

  14.  
  15. #8

    Join Date
    Mar 2006
    Location
    Raleigh, NC
    Posts
    3,416

    Default Re: Post Your Total Annualized Rate of Return

    8.77% over 25 years...
    The S&P500 did 12.02% in the same time-span...
    I would have done better BirchTreeing it for the duration..

    However, I kinda did. At least till about 2007. That is why I am not certain about the calculations. This is actually a hard thing to do, eh...

    For me, this includes the brilliant move of 'saving' only the 1% 'match' into the 'G Fund' till 1994. Yowser. Start early. It is more important to have time in the market than to market time.
    Lookin' up at the 'G Fund'!!!

  16.  
  17. #9

    Join Date
    Feb 2011
    Location
    Washington
    Posts
    9,583

    Default Re: Post Your Total Annualized Rate of Return

    Quote Originally Posted by RealMoneyIssues View Post
    Delete, missed the "annualized"

    Will have to figure that one out... brb
    4.67% over 12 years

    Rules:
    - Trade what you see, not what you believe
    - Don't put stuff in your signature that a Mod doesn't like

    "Government exists to protect all people’s rights, not some people’s feelings." - A. Barton Hinkle

    Great Tools:
    http://www.CreditKarma.com
    http://www.Mint.com
    http://www.SaveUp.com/r/nmJ


  18.  
  19. #10

    Join Date
    Aug 2008
    Location
    Pensacola, FL
    Posts
    6,312

    Default Re: Post Your Total Annualized Rate of Return

    Is someone going to help me with the formula or not? Where's the love?

  20.  
  21. #11

    Join Date
    Feb 2011
    Location
    Washington
    Posts
    9,583

    Default Re: Post Your Total Annualized Rate of Return

    Quote Originally Posted by jpcavin View Post
    Is someone going to help me with the formula or not? Where's the love?
    Quote Originally Posted by Cactus View Post
    Then it occurred to me that this is only the case if I had plunked the contributions down at the start and contributed nothing since then. That is the opposite of what I, and most people, do. We start with nothing and make contributions every paycheck. How much? Well that varies over time for most of us as our contributions go up with cost of living increases, step increases, and promotions. But, as a first step approximation I decided to divide my Lifetime TSP Contributions evenly over my entire government career and see how that affected my return. You can use the TSP How Much Will My Savings Grow Calculator, but I used the Growth + Contributions Calculator in the attached spreadsheet to come up with these gains for select years and growth rates:


    I just used the bottom section...
    Rules:
    - Trade what you see, not what you believe
    - Don't put stuff in your signature that a Mod doesn't like

    "Government exists to protect all people’s rights, not some people’s feelings." - A. Barton Hinkle

    Great Tools:
    http://www.CreditKarma.com
    http://www.Mint.com
    http://www.SaveUp.com/r/nmJ

  22.  
  23. #12

    Join Date
    Oct 2008
    Location
    Stinking desert valley of bad air quality, AZ
    Posts
    2,993

    Default Re: Post Your Total Annualized Rate of Return

    Mine comes out to 7.84% @ 16 years.

    jpcavin, the formula is very complicated, at least to me. Use the functions in Cactus' attached spread sheet in the first post. Leave cell B1 at 26, ignore the rest and fill in cells B23, B24 and B25. Your example comes out as 28.78%.

    This does make the assumption that all contributions over the years were equal. At least I think it does.

    To get the real real number I believe you would have to get the averaged balance per pay period and figure the rate of return per pay period and then figure out the overall rate of return based on the return per pay period. I may be wrong on that and may be using the wrong function name as I am no Cactus when it comes to these things. Using other spread sheets Cactus has posted I think you could do this but it is a lot of data entry.

    PO

  24.  
Page 1 of 3 123 LastLast

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  
S&P500 (C Fund) (delayed)
Post Your Total Annualized Rate of Return
(Stockcharts.com Real-time)
DWCPF (S Fund) (delayed)
Post Your Total Annualized Rate of Return
(Stockcharts.com Real-time)
EFA (I Fund) (delayed)
Post Your Total Annualized Rate of Return
(Stockcharts.com Real-time)
BND (F Fund) (delayed)
Post Your Total Annualized Rate of Return
(Stockcharts.com Real-time)

Yahoo Finance Realtime TSP Fund Tracking Index Quotes