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Thread: 14 years out, but feel like I'm behind

  1. Default Re: 14 years out, but feel like I'm behind

    Well, going to keep upping the amount. I Just hope i'm not mismanaging it. I'm feeling dumber the more I read.

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  3. Default Re: 14 years out, but feel like I'm behind

    Quote Originally Posted by DreamboatAnnie View Post
    Welcome aboard WJPennington! Sounds like your doing an outstanding job of investing and saving for the future! Adding your yearly increase to retirement us a great way to max out without feeling the pain. That is what I did early in my career and thankful for it now.

    I noticed you mentioned TSP savings to leave to some for your disabled children. I would suggest you look into putting some money into Roth TSP or external Roth IRA, if possible. Take advantage of the tax sheltering provided by regular TSP contributions, but also pay tax on some savings going into your Roth to the point where lack of sheltering via regular TSP contributions does not kick you into the next higher tax bracket by year end, and to extent you can afford to pay taxes now for money going to the Roth. That will allow for tax free gains within the Roth and all tax free withdrawals in the future when taxes may exceed anything we are imagining now, and when loved ones must begin withdrawing. Of course, this may work for some folks and not for others. I definitely wish I had started sooner. But you are in very good position to plan for this and execute.

    Best wishes to you in your investments.
    I'm allocatign everything to ROTH right now--the only thing going into the traditional is the agency matching witch they wont change sadly. probably will try to do a back door conversion at 59.5, get as much as possible into Roth. Goal is to get as much tax free. Kansas doesn't tax federal pensions, nor TSP distributions, or TSP transferred into qualified retirement plan, then if I can get the taxable income low enough, no state tax on the social security.

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  5. Default Re: 14 years out, but feel like I'm behind

    ok, so , I'm looking at the various premium services. I've come to the realization I'm out of my depth, I'm not going to be able to figure this out on my own anytime soon, and if I rely on my own judgement, I'll just screw things up from hopeless incompetence. But, instead of retreating to a Buy and Hold 70C/30S allocation and not looking back until the year before I retire, which of the premium services here should I consider?

    I need ones thats straightforward, weasy to grasp, chart light, clear directions on when to do IFT's, and when to change allocations, and how much. Right now, I'm trapped into G hoping for a downturn, though my purchases are still C/S. But I want to have a direction once I'm free to break out of G Fund jail without a loss.

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  7. #16

    Default Re: 14 years out, but feel like I'm behind

    Hi wjp,

    I sent you a private message with some info about the different services.

    Good luck!
    Tom
    Market Commentary | My Blog | TSP Talk Plus | |

    I am not a Registered Investment Advisor. Please do your own due diligence.

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  9. #17

    Join Date
    Mar 2006
    Location
    Raleigh, NC
    Posts
    3,210

    Lightbulb 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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