Ask The Experts: Money Matters

By Mike Miles

TSP allocation

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Q. I’ve been in the government for four years (retired Army) and have invested in the Thrift Savings Plan since 2009. I plan to retire from the government in 2020 with 11 years of service (I’ll be 58).

My TSP portfolio is diversified but certainly heavy in the C and S funds. To avoid the losses all experienced several years ago, what are the recommended allocation moves, within funds, that one should take during what appears to be a stock market selloff that has started in August?

A. Unless you plan to withdraw and spend all of your money within the next few years, you should be in all five TSP basic funds all of the time. Ideally, you should identify and use the asset allocation scheme that will support your particular set of goals with a minimum of risk. This can’t be done without some rather complicated analysis. In that absence of certainty – or even a reasonably good idea – of where you should be, I recommend a mix of something like 30 percent C Fund, 20 percent S Fund, 10 percent I Fund, 20 percent G Fund and 20 percent F Fund. This is kind of like recommending that you fly your plane straight and level without knowing where you are or where you’re going. It might not get you there, but it’s the safest bet without more information.

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