PDA

View Full Version : L fund? New guy



darwat
09-14-2007, 04:48 PM
I am very young and just started investing into the tsp? Is L fund the right choice for me?:confused:

Frixxxx
09-14-2007, 05:24 PM
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!:cool:

BTW welcome to the boards!

EW_ret
09-14-2007, 06:59 PM
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 (http://www.tsptalk.com/tracker/tsp_user_balance_all.php) 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 (http://www.tsptalk.com/system.html) and the EbbChart Trading System (http://www.tsptalk.com/ebbchart.html). 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.

Show-me
09-14-2007, 09:28 PM
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. :eek: I'm just kidding about the bleeding and starving part. :laugh:

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,:blink: but the end result will blow you away. :nuts: 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.

nnuut
09-14-2007, 09:40 PM
Darwat, welcome!
Norman:D

James48843
09-14-2007, 11:19 PM
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.

DCguy
10-12-2007, 02:33 PM
L fund invests heavily in C. I know C desn't pay as well as I. Is C much safer than S or I?

SkyPilot
10-12-2007, 02:41 PM
I am very young and just started investing into the tsp? Is L fund the right choice for me?:confused:

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!

chezhoy
12-27-2007, 07:34 PM
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.


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

Barney
12-27-2007, 07:43 PM
All you really need is a blindfold and a monkey with some darts. You will probably outperform most TSPers. :laugh: Oh yeah, have you checked out any of the premium services?

Bullitt
12-27-2007, 08:53 PM
Darwat,

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

Great link here.


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.

rokid
12-27-2007, 09:44 PM
I am very young and just started investing into the tsp? Is L fund the right choice for me?:confused:

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

tmc1045
12-27-2007, 11:39 PM
As long as we have the ability to make unlimited IFT's, you only help yourself by becoming educated on being an active (and knowledgable) manager of your funds....if only I had started when I was young.

chezhoy
12-28-2007, 01:12 AM
I can't agree more! I wish I would have started just 3 or 4 years ago...I'd have over $10k right now, easily.


As long as we have the ability to make unlimited IFT's, you only help yourself by becoming educated on being an active (and knowledgable) manager of your funds....if only I had started when I was young.

Barney
12-28-2007, 01:21 AM
I can't agree more! I wish I would have started just 3 or 4 years ago...I'd have over $10k right now, easily.

Chezhoy,
I am not bragging, but learn from others around here...When I started lurking here in Jan 2006, I had been in gov't. for 3 1/2 years. In one year I more than doubled my TSP, and I am only contributing 5%. There are some very wise people here; I am but a pupil. Plus, 2006 was a good year. I think you are going to like it around here.:)

chezhoy
12-28-2007, 01:32 AM
I remember when the TSP opened up for military. I worked Customer Service at Dover AFB MPF. We were the POCs for the forms...that must have been in 2001...6 years behind, but like I said better late than never. I am really enjoying these forums. I like what James wrote in my Newbie post. I actually just switched mine to 50/50 C/S because of the increase in the past month. I heard 2006 was a great year...2007 is okay...hopefully 2008 is better. As Jimmy Buffett once sang, "Only time will tell." :)


Chezhoy,
I am not bragging, but learn from others around here...When I started lurking here in Jan 2006, I had been in gov't. for 3 1/2 years. In one year I more than doubled my TSP, and I am only contributing 5%. There are some very wise people here; I am but a pupil. Plus, 2006 was a good year. I think you are going to like it around here.:)

Barney
12-28-2007, 01:42 AM
I remember when the TSP opened up for military. I worked Customer Service at Dover AFB MPF. We were the POCs for the forms...that must have been in 2001...6 years behind, but like I said better late than never. I am really enjoying these forums. I like what James wrote in my Newbie post. I actually just switched mine to 50/50 C/S because of the increase in the past month. I heard 2006 was a great year...2007 is okay...hopefully 2008 is better. As Jimmy Buffett once sang, "Only time will tell." :)
Nice tune! I was a crew chief on RC-135's out of Offutt AFB till 91. Are you still in?

chezhoy
12-28-2007, 09:37 AM
Any Buffett is good (so is Bob Marley). I am still in. I have been in just over 10 years. I am in Denver...getting ready to Palace Chase to the AGR world and going to Langley...I leave at the end of January. I get a nice promotion out of it too.


Nice tune! I was a crew chief on RC-135's out of Offutt AFB till 91. Are you still in?

tom1tom1
01-16-2008, 03:45 PM
L- funds are starting to look better all the time

tom1tom1
01-16-2008, 03:49 PM
But the I-fund has outperformed all funds the last 4-5 yrs

Barney
01-16-2008, 05:20 PM
L- funds are starting to look better all the time

L-Fund is taking a beating like we are. Actually, most of the L-Funds are doing worst than most of us. The G-fund is looking better all the time!:D

Silverbird
01-17-2008, 10:21 AM
:blink: L funds are not tested for a a downturn - they have not been around for long enough. Drive carefully. I suggest the Basic Typing Lessons Funds: FFF GGG , with a little stock if you really want. But I mean a little, even Lincome is 25% stocks, which may not be the best road right now.

saturneptune
01-17-2008, 04:34 PM
:blink: L funds are not tested for a a downturn - they have not been around for long enough. Drive carefully. I suggest the Basic Typing Lessons Funds: FFF GGG , with a little stock if you really want. But I mean a little, even Lincome is 25% stocks, which may not be the best road right now.

I have been in L2010 for quite a while, and bailed to G today, first time. I am eligible to retire in August, and have had enough.

Scottydog
02-01-2008, 01:37 PM
But the I-fund has outperformed all funds the last 4-5 yrs

Yeah but it's been beaten up pretty good this month more so than any other Fund YTD.

2040 for a newbie is the way to go. I should have probably put my money in that when they came out...the rebalancing throughout the year actually adds some extra % that you normally would not have in a target fund. That's an added bonus. Plus it's just a cruise control fund....adjusts and rebalances itself.