Thinking of delaying your retirement because of the market? [Archive]

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ChemEng

10-20-2008, 03:49 PM

It seems like your retirement horizon would be a prime consideration along with whether you are CSRS or FERS... Im not sure that your Yes/No metric tells even part of the story.

Frixxxx

10-20-2008, 04:08 PM

It seems like your retirement horizon would be a prime consideration along with whether you are CSRS or FERS... Im not sure that your Yes/No metric tells even part of the story.
Nice Chemeng,

Miss Neal, I would answer that question with an emphatic NO. However, My eligibility date for retirement is 2024. See where your math falls short?

You should be asking (only FERS) employees with 5 or less years to go. That will be a good start to reflecting what is REALLY affecting retirement decisions.:cool:

CountryBoy

10-21-2008, 07:39 AM

Nice Chemeng,

Miss Neal, I would answer that question with an emphatic NO. However, My eligibility date for retirement is 2024. See where your math falls short?

You should be asking (only FERS) employees with 5 or less years to go. That will be a good start to reflecting what is REALLY affecting retirement decisions.:cool:

Miss Neal,

I currently have less than 5 years to retirement and this drop in the market hasn't changed my plans at all. I have protected my TSP Funds and with a couple of lucky IFT's have managed to add a little to it.

The following article that Fedsmith linked to will have a greter impact on my plans for tetirement.

http://www.workforce.com/section/00/article/25/83/58.php

If the Dems are allowed to, lets call it what it is, steal OUR retirement money and place it in a plan that is a loser, then I'll have to run the numbers again to see if it would be more economically advantageous to retire earlier, to beat the plundering of our hard earned retirement savings. We've scrimped and saved and done without some of nicer things in life so that we could have a pleasant retirement, but the Dems are hell bent to give our money to those spendthrifts that didn't prepare for retirement. Winter can be cold and hubgry for those that don't prepare. Isn't there some sort of anecdotal parable about this? A little pumphead/senior moment here. :)

CB

XL-entLady

10-21-2008, 08:35 AM

Winter can be cold and hungry for those that don't prepare. Isn't there some sort of anecdotal parable about this? A little pumphead/senior moment here. :)

You're referring to the ant and the grasshopper? (I really hate it, too, when my reference librarian goes on coffee break! :cheesy:)

Lady

Silverbird

10-21-2008, 08:56 AM

I'm in FERS with nearly 20 years in, I had no choice in FERS vs CSRS. Because of the rules for FERS, unless I retire at 62, I will get 10% less a month in my FERS annuity, so I will not retire earlier than 62. The math on Social Security is laughable, unless I decide I really want to stay until I'm 70 - IF there enough money to back up the system when us Busters retire. I do not think Social Security will have enough money to pay back the Boomers on what they put in, and suspect it may run out right when the most long-lived of that group is most in need, and us Busters are in the middle of our golden years (if not earlier).

That leaves TSP as my main source of retirement funds. With nearly 20 years in, I already have a considerable amount of money in my account. G fund frankly does not pay enough to cover inflation. Parking in the L funds during the first 3 quarters of this year, if you are a Buster in L2030 or L2020 due to you later retirement date, who has a considerable amount of money already in the system, you just went back in time to 2003. There is a huge difference between averageing 7% a year (where I was up to the end of last year) to how bad it would have been if I hadn't gone to G during the first quarter of 2008. I am able to enter the market now through payroll and loan deductions (I have a residental and a personal loan outstanding). Because I could move my funds around, my retirement didn't suffer a huge haircut. But anyone with a lot of money in the TSP who parked L 2020 or worse, 2030, and didn't look is in considerable distress now, especially if they paniced in the last month.

I may not have to delaying my retirement yet, thanks to my ability to get out before everything tanked. However, on the longer term, it depends how returns look over the next few years. If the stock market takes a long time to recover, and my assumption of an average of 7% a year returns is wrong, I will have to consider retiring after 62. And how about those who just parked and then paniced at the worst time?

However, even they can recover - because they can delay their retirement. The people you should be worried about are the ones who already are retired and did not expect a negative return on their nest egg. How are they going to recover from a bad Parking L decision??

Show-me

10-22-2008, 06:21 AM

Ms. Neal,
Welcome! Your question was fine, what you have here is a group of rare birds that ARE planning their retirement years and decades in advance. We are trying to learn and prepare.

Silverbird

10-22-2008, 10:07 AM

tweet. Sorry. Got excited, but wasn't sure you were looking for us long termers so I posted here instead of e-mailing

Intrepid_Timer

10-22-2008, 11:09 AM

I have at least 12 years till I retire. However, because of our TSP, I plan to leave the federal government within a year so I can take control of my own TSP funds and be able to actually retire one day. We all know we can't rely on social security to be there at this point. With market at it's current levels, do you know how many years of contributing towards retirement people that buy and hold just basically threw away. Perhaps someone could help with the numbers I don't actually know them.

This current decline in the market just reaffirms my decision to leave the government. Now if they would give us the option of rolling our TSP over into our own Roth or regular IRA, which I think they should do whenever they start changing the rules on us, then I would gladly stick around. Going from daily transfers to two a month is a major rule change and sort of breaks a "contract" agreement. People should have been given the option to take their money elsewhere then.

Pill

10-22-2008, 12:00 PM

I haven't thrown away anything. I am a buy and hold guy. Everyone has their own style but I have to laugh when guys jump ship to the g fund. I still own the same number of shares and yes it will rebound like it always does and usually to a higher high. Us buy and hold investors are still DCA'ing getting a supper good deal right now. People who bail are the ones throwing $ away. (This is all in respect to those who have plenty of time)

I am certain in 1-3 years I will be glad I stayed put and continued to Dollar Cost Average. I believe most buy and hold investors will outperform the average market timer. I am not trying to convince you here, but everyone has their own opinion. Simply stating that buy and hold just threw away is just incorrect.

06savefor2012

10-22-2008, 12:04 PM

The day I was advised that I had to go to FERS retirement system I was worried about this new idea of gambling with my retirement funds in the stock market. Here I was, a civil servant with a good decent retirement system. Now I had to learn how to TRADE, move money around in Funds, study up on the markets, consider the DANGER, the HAZARDS, the PERILS, the CEO MENACE, the CEO CRIMINAL acts commited with public funds.

This is not my idea of a good retirement system even if the market turns and I end up with a lot of money when I need it. Slow, dependable, steady money taken out of my check for retirement knowing that I had enough to get by when I am old, not in the best of health, still helping with college and the trials and tribulations of having children that need help later in life, would have made me a lot happier in the long run. Worrying about money after you retire like some folks are having to do right now is not right and not healthy. Of course it is how and why we got to this point that makes a big difference to me. I don't like what I hear and see and I don't like the fix either. My confidence in this FERS retirment system is not very high even with a recovery here. This system is still run by the super rich who seem to walk away with much more than they deserve while the rest of holders are lucky to survive with a retirement when they need it most. Having to go to a cash position in a retirment fund to survive is nuts.

malyla

10-22-2008, 12:28 PM

I am certain in 1-3 years I will be glad I stayed put and continued to Dollar Cost Average. I believe most buy and hold investors will outperform the average market timer. I am not trying to convince you here, but everyone has their own opinion. Simply stating that buy and hold just threw away is just incorrect.

I hope you are right. My analysis short cuts the losses in a bear market. I guess this makes me a long term position trader. The spreadsheet showing the returns of B&Hers and other investment strategies is here: http://www.tsptalk.com/mb/showpost.php?p=171093&postcount=112

Buy and holders don't loss anything but time. If it takes 5 years to get back to the share price of Dec 2007, then you have only lost that 5 years of growth, three of which were probably zero growth, with the last two providing a rocket up to Dec 2007 prices. This is your best case scenario. The depression took 24 years to get back to the share price from the high in Sept 1929. This two links (posted by others on the MB somewhere) will show this:

http://generationaldynamics.com/cgi-bin/D.PL?d=ww2010.i.djia

http://www.nytimes.com/imagepages/2008/09/21/weekinreview/20080921_LEONHARDT_GRFK_A.html

I would love to have the time to leave it and forget it, but I don't, so I have a method that uses the business cycle to position my retirement funds to maximize the returns in the shortest time. I don't have the time or IFTs to trade each month, so I feel good about this. When the Bear market is over (using indicators to confirm), I will move into stocks. Until then - shhhhh- I'm sleeping.:) Hoping to retire on time!

Good Luck.
Malyla

James48843

10-22-2008, 02:49 PM

Shhhhhh....... (I have a secret).

(I have it on good authority that it isn't going to take 24 years to get back to last October's levels.

You can believe me, or not believe me- that's your choice- and it MAY get worse before it gets better. )

BUT---

America WILL come back.

You'll see.

It just might take a little bit.

Steadygain

10-22-2008, 02:55 PM

Buy and holders don't lose anything but time. If it takes 5 years to get back to the share price of Dec 2007, then you have only lost that 5 years of growth

Good Luck.
Malyla

I'm just reflecting - not at all wanting an argument.

I feel the Buy and Holders lose quite a bit more than those who shift their allocations for Capital Preservation and Greater Gains.

In January of 2008 the TSP had it's largest shift from high risk to safety (G Fund). The overwhelming majority likely kept it there and everyone of them has gained throughout the entire year - with every additional biweekly contribuation adding up.

ALL Buy and Holders have lost over 30% - some even more.

When the Markets stabilize and the healthy start of sustained growth begins - all B & Hs will be at least 30% behind the others.

malyla

10-22-2008, 02:57 PM

FUTURESTRADER

10-22-2008, 03:34 PM

When the Markets stabilize and the healthy start of sustained growth begins - all B & Hs will be at least 30% behind the others.

thats assuming the 'traders' get in at the absolute bottom, Steady, which will be 50% luck, 50% skill. The majority, I'm guessing will need several percent upward confirmation or consolidation, over a few days, to go 'all in'.

James48843

10-22-2008, 03:38 PM

I believe you;)

Who's your authority? Will you share?:embarrest::D We could all use some good words right now.

You could use some good words?

Ok-

Here's some good words...

PXY7TkrPPzI

Frixxxx

10-22-2008, 03:49 PM