When to put money in the TSP?

[managingts]

Since we've got this way-too-awesome daily seasonal strategies, I was wondering if you guys have thought of putting a lot more in the beginning of the year or spread your TSP contribution all throughout the year?

I thought about putting the big chunk of my TSP contribution at the beginning of the year and leave enough money to still get the 5% match from the government for the rest of the year.

Thanks.

[adm_m]

my two cents: I like mine spread throughout the year to take advantage of dollar-cost-averaging.

[Jokerswild]

Since we've got this way-too-awesome daily seasonal strategies, I was wondering if you guys have thought of putting a lot more in the beginning of the year or spread your TSP contribution all throughout the year?

I thought about putting the big chunk of my TSP contribution at the beginning of the year and leave enough money to still get the 5% match from the government for the rest of the year.

Thanks.

You obviously are referring to the new BRS which I don't believe many of us within this site, well at least those that post frequently, are under the High-3 system if still active duty. If I'm following you correctly, hypothetically by placing much more at the beginning of the year instead of spreading it out, you might be able to reach a higher amount in your TSP by the end of the year due to compounding BUT you could also lose it just as fast at the beginning of the year if the market crashes, and then you will spend the rest of the year trying to make up for the loss. Personally, I'm pretty comfortable taking set percentage out and as rank increases, so does the monthly deposit. We all have enthusiasm towards all the information provided here on this site, but we still can't forecast exactly how the market with act, something just to stick in your mind.

Am I following your strategy correctly? The thing is, by trying it out your way, there's nothing wrong with it if it works. If you are comfortable with that plan, then don't let anyone tell you otherwise. Even with the best information here, we all are still trying to pick the right path to financial success in the future, but it's still an estimated guess IMO.

[Scarfinger]

my two cents: I like mine spread throughout the year to take advantage of dollar-cost-averaging.

This is the best approach in my opinion.

[tegsr94]

I think you have a valid strategy here. However, I suspect that for the vast majority of government employees that are contributing the max ($18k/year) its quite a burden on the budget all ready while it's spread out over 26 pay periods (692/check) let alone all up front. Personally my monthly budget would not be able to withstand contributing a ton more in the first few months, because I need the income for other expenses.

[evilanne]

It depends on what the market is doing. You may want to consider putting a set amount in on a regular basis and increase that amount when the stock market has a correction or trending downward. The only problem with this is that you have to change your contribution amount before the pay period starts--the market could be back up before any increased contribution takes place. Your method would have worked well in 2009, 2016 or this year very well. In 2008, it would have been better to increase contributions towards the end of year.

Another option: When seasonal strategy calls for the F Fund (typically when stocks don't do well & corrections are more likely) increasing the amounts may be worthwhile. January, June, August & September are the months most seasonal strategies are in the F Fund. This could work well for those who are contributing max and changes could be planned out.

[NotSoGood]

Another option: When seasonal strategy calls for the F Fund (typically when stocks don't do well & corrections are more likely) increasing the amounts may be worthwhile. January, June, August & September are the months most seasonal strategies are in the F Fund. This could work well for those who are contributing max and changes could be planned out.

When I was still working, I also thought about contributing my full paycheck the first whatever to reach the max (minus what I would need for the remainder of the year to get the matching) as early as I could in the year.

I realize that would take some budgeting planning in previous years to get the money needed to cover Jan/Feb bills, but my thought was: The earlier in the year I get the money into my TSP, the greater opportunity I had all year long to make that money work for me.

What I never thought about was what evilanne proposed: Wait for months where -- traditionally -- the market was down to buy as much as I could at the low parts. Then I would have a lot of shares to work with the remainder of the year.

Just interesting to me that someone else was thinking along the same lines.