Re: 14 years out, but feel like I'm behind
One thing to consider is that C/S/I are risk based. Having a 14 year investment time horizon means you can invest all/most in C/S/I. It is tough to find (maybe impossible) a 14 year window where C/S/I would lose to a G or G/F allocation.
Investing in only the G-Fund will give you a second Social Security check - likely actually less since the politicians promise more than the return offers. So, if your Social Security is likely to be $1,400/month than your TSP will provide you about $1,200/month. That is the Alpo Meal Deal Retirement Plan. You do not want to be 'invested' in the G-Fund for any lengthy period of time.
Investing in the F-Fund will do you better, but you kinda need a decent investment base. Again, with a 14 year time horizon, you have to put air quotes around 'investing' in the F-Fund.
Investing in C/S/I will more than double your account every 7 or so years. HOWEVER, there is a timing risk. With 14 years the timing risk is a big 'whatever', but once you are in the 7 year window it becomes a danger point. What I am saying is that you really have about 7 years of pure growth investing left. Somewhere around 7 years prior to retirement you SHOULD have holdings in G and F. Those holdings should eventually cover about 5 - 7 years of expected spending above your pension, Social Security, and other safe income. That means that you have to take risk now to be able to hide a sizeable chunk of safe assets from the market. Does that mean all in? Nope. Does that mean all out? Warren Buffet doesn't ever get all out. Your all out move has been a marginally good move this month and I kinda agree with it, but the best returns happen very early on the bounce backs. What was your allocation on 2009/03/06? If it was all G/F and if you held that crap allocation for another 3 months+ then I would not market time.
Let us look at the Fund returns from 2003/01/01 to 2021/08/31:
Fund |
2003 |
2021 |
Growth |
G |
10.00 |
16.65 |
66.50% |
F |
9.97 |
21.07 |
211% |
C |
10.03 |
67.96 |
677% |
S |
10.05 |
86.30 |
858% |
I |
10.17 |
39.52 |
388% |
That included the 2003 recession and the 2008 Great Recession.
So, at this point one of the premium services would be a great investment. It will likely help you avoid the BIG downturns and will also likely get you back in earlier than your gut will otherwise let you. At the seven year mark I would definitely math out what you need over Social Security, your Pension, and other safe income and start moving that to G and/or F. Then if you retire on a day like 2008/12/31 you will have seven years of safe money that will allow your C/S/I to recover and boom.
Happy Hunting...
Lookin' up at the 'G Fund'!!!
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