New guy here and just transfered to G.

[harpole]

Hello everyone,

I'm a newbie when it comes to posting on the forums and thought it would be a good time to post. Just last week I submitted my first IFT, with 100% to G fund. My thoughts were that the market hit "another" all time high so why not take profits. Now I'm concerned that I got out to early.

What are my next options? Should I wait for the next dip and put 20-40% back into the C fund? Also, is it best to have my contribution allocations sent to the G fund or always going into the C or S?

I don't think I have the courage to follow the seasonal strategy, as I have trouble moving 100% of my retirement into a stock fund.

I'm 39 yrs. old and now that I've finally made it to the 6-digit mark, I'm more cautious than ever.

Thanks,

[cashworth]

It sounds like your signs are pointing towards equities so here's my 2 cents (if you are asking whether to move or not, skip this post) (for what its worth because I'm also a newbie, I'm in it to win it!! 30C/30S/40I)

If your technical indicators point towards a new top and upward momentum, in theory you should buy back in asap because every day out of the market is a day with no gains and climbing share purchase prices.
Or, you can wait for a drop and time the market to buy back in on a discount day which is very tough with COB trading.

[evilanne]

Welcome to the forum harpole & cashworth!

Harpole, I understand the hesitation in moving 100% to any fund, especially if you have a large balance but at the same time a pull back may never come and you have quite a few years to go until retirement. You could try picking a percentage you feel comfortable with and try the seasonal with XX% of your account. Trying to time the market generally is counter productive and options are limited with restrictions on IFTs within TSP. Good luck with whatever decision
you make.

[Foghorn2]

Harpole,

Several questions/thoughts from a wannabe financial counselor (hopefully get my AFC in the next five years):

1. When do you plan on retiring? More importantly, when do you plan on using the money within your TSP? At 39, that is 20.5 years away from the traditional withdraw period (I know there are exceptions). Even if 2008-2009 happened this year, or the next five years (or 10) you are going to recover (historically speaking). Especially if you want to play it safe and keep a portion in the G fund and simply move around some for higher returns. Ex: 50% G, Move 50% C,S,I - market tanks an absurd 50%, you lose 25% of your account.

While most on this site don't advocate for the L Funds (I don't use them either), that would be another approach if you wanted to be more hands off while maintaining a sizeable portion in the G fund.

2. How much money do you want when you retire? If you just hit 6 figures in the TSP, good on you, that is better than many Americans are doing at saving; however, I know my calculator suggests having around $420K by age of 39. Retirement savings goals are truly fueled by how you want to live in retirement. If you are comfortable with where you are at and don't want to risk it, don't. For me, I will not be able to live how I want unless I am more aggressive. If I lose it all, I will either work longer, or beg my children for room and board.

3. I have my contribution allocation set for the G fund, but that is because I do multiple IFTs per month. This allows recently contributed money to be in a safe fund until the monthly IFT moves it to its appropriate category. If you wanted to keep all of your current money safe, you could park it in the G and then set your future contributions for another fund (or several). That would allow you to enter the market slowly again, while knowing your hard earned nest egg isn't moving.

[TopNotch]

Earnings season is just getting started. You can keep your eye on the C and S funds to see if they start an upward trend. Then decide whether you want allocate some portion to the C and S funds.

[Navig8tor]

Hello everyone,

I'm a newbie when it comes to posting on the forums and thought it would be a good time to post. Just last week I submitted my first IFT, with 100% to G fund. My thoughts were that the market hit "another" all time high so why not take profits. Now I'm concerned that I got out to early.

What are my next options? Should I wait for the next dip and put 20-40% back into the C fund? Also, is it best to have my contribution allocations sent to the G fund or always going into the C or S?

I don't think I have the courage to follow the seasonal strategy, as I have trouble moving 100% of my retirement into a stock fund.

I'm 39 yrs. old and now that I've finally made it to the 6-digit mark, I'm more cautious than ever.

Thanks,

If you've got a 6-digit portfolio now, your gains are more noticeable (as are your losses); however, you gotta have money to make money. Leaving a big chunk sitting in the G-fund isn't doing you any good in today's investing world.

10% of $100K is $10,000. 10% of $1000 is $100. With a 6-digit portfolio, you can easily make $1000/day on a good upswing. Of course, you can easily lose the same amount. Regardless, if you have $100K and leave 70% of it in the G-fund making .01% per day, you're really not helping your "retirement fund" grow. You're only "working" 30% of your portfolio. That, to me, would be really conservative.

At your age, you've got a solid 23-28 years to work your portfolio. You need to let it ride. Back in the day, I was the same "sketchy" way about moving 100% of my portfolio into and out of stocks; however, make $14,000 in a month and you'll be HAPPY to cash out for a week or three. That's "market timing." In an out (with your two IFT's) as best you can. Many don't like market timing; many do.

If you'd rather diversify and squat, divide your portfolio and leave it there but PAY ATTENTION so you don't get caught up in a long-term downtrend. Look at folks like wwwtractor and rcsinjax (on the leader board by account balance). wwwtractor has had the same allocation since 2015 and he currently has an 11%+ return AND the 4th highest balance on TSP Center.

As for buying in now, well, I think history will repeat itself and there will be a summer downturn here shortly. I prefer to wait it out. You may miss smaller rises here and there, but the summer swoon will come.

[harpole]

I want to thank everyone for their recommendations. It is greatly appreciated.

Foghorn2,

1. I plan to retire at my MRA of 57.5, but realistically it will be age 60. My wife is 3 years younger than me, so I could still retire at 57 but delay payments until 60. (medical issues play into account here as well). I'll have 27 years of federal service at age 57.

2. I hope to have at least 600k saved prior to retirement. I currently contribute 14% into the TSP and plan to increase that 1% with annual raises. My wife also has a 401k plan with her employer and I have no idea how much she has saved. I do know she is invested in a semi-conservative L fund type.

3. I just recently changed my contribution allocations to 100% into G fund. (It was at 50% C and 50% S) I may change that when prices start to come down.

I'm warming up to evilanne's idea of using a percentage of my account in the seasonal strategy.

[Foghorn2]

Harpole,

You have some things working for you that I do not. My spouse home schools, so I'll be the sole retirement provider. Also, my plan is to retire at 46/47, which means far less contribution years. Given your current position at say 100k in, with a 600k goal at age 60, you only need to contribute 159.68/mo at 8%/yr to meet that goal. Even going off a 2%/yr return, you and your wife would only need to contribute $1,500 a month to meet that goal. Looks like you are doomed for success.

[Jokerswild]

Good advice by all and I second the placing your contributions into the G fund until you're ready to IFT them to something else. It's a solid way to ensure you'll be making gains on what you just contributed without having to plan it just right if you are doing a daily seasonal strategy.

Take a look at the tspcalc.com and highest returns for a set period of time. You'll see that many of the ones with some impressive returns, are only in stocks 61% of the time. If you are doing any of the L funds or C,S, or I for the whole year that's 100% and higher risk. Just something to ponder but try the fantasy account for a little while until you see what works best for your comfort level. In my opinion, the seasonal strategies are the way to go, much less stress, much less reading, and once you take your emotions and thoughts out of it and base it off historical data, I think you're better off. You can't always predict what and how the market will react on any given news.

[ron.logan]

Earnings season is just getting started.

I thought Aug/Sep were the slow not so good months for stocks. At lease that is how I read the seasonal strategies as most go to G or F these months. Am I reading it wrong?

[Hellweek]

Here's my two cents.
When I first started in 2013 I put my TSP in the L fund, and found this site. I made about 1 IFT a month through 2014 with my fantasy TSP, and did pretty well. I thought I had it worked out, in 2015 I matched my TSP and fantasy TSP, and really got burned. Now I use this site to keep me engaged with the market and to learn, but generally follow the seasonal strategy for my real TSP. I still keep about 20-30% in the L fund, and about 10% in the F or G fund, and the rest I dump into the I, C, or S depending on various factors.
I have been sticking somewhat closely to the seasonal strategy and went to F in June (May for TSP center because I was experimenting with something that didn't work out). Sure I have missed over a month of pretty good gains, and they may continue, but the market is unpredictable, and I have some consolation with my 30% in L fund still making some gains. I would recommend just finding a strategy you are comfortable with and stick with it, and make modifications slowly as you learn. Remember by low, sell high

[harpole]

I have an old Post-it note taped under my computer monitor that reads, "Be fearful when others are greedy and greedy when others are fearful" (Buffett). Its a constant reminder to be patient and to not go with the flow.

I think that's one reason why I moved to the G fund, because I've really only seen the market go up since I started contributing to the TSP (2011). Just maybe it was time to be fearful. My average rate of return over that time has been around 12-13%.

I would like to add that this discussion is very beneficial to someone like me.

Thank you.

[Scorpio70]

Welcome. The reality is that we cannot afford to keep money in the G fund long term. If you plan on retiring in 20 years you are better off is the C fund.

[Navig8tor]

Here's my two cents.
I still keep about 20-30% in the L fund, and about 10% in the F or G fund, and the rest I dump into the I, C, or S depending on various factors.

Help me out with this one: what is the point of keeping a portion of your portfolio in an L fund, then "adding 10% in the G or F, and then "dumping the rest in C/S/I" ??

This is the breakdown of the L2040:

G: 20.58%
F: 6.42%
C: 39.10%
S: 12%
I: 21.90%

So - if you're portfolio is 30% L2040, you've got: 27% of that 30% in the G/F, and 73% in stocks, with a very heavy weight tilted towards the C/I...and then you put AN ADDITIONAL 10% into the G and/or F. The rest you "dump into C/S/I."

I don't see the point of the having money spread like that both in an L-fund AND C/S/I. There is a lot going on there with counter-intuitive investments i.e. USD goes down and it negatively impacts the I-Fund. Also, what normally happens is investors hedge stocks with bonds, i.e. when stocks pull back, bonds will usually go up. With such a small 6.5% "hedge" in bonds in the L2040...you're not offsetting the losses you'll have in C/S/I or the overall L2040.

[GUTK]

I believe it is just a persona strategy. A way of not getting caught with all your eggs in one basket per se. It is a personal diversification based on ones preference, experience, trends, etc.