Ask The Experts: Money Matters

By Mike Miles

L Fund recommendation

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Q. You recommend  that if we do not feel comfortable managing our TSP,  we should  invest in the L Fund that most closely corresponds to our life expectancy. However, the L Funds are named for the year we expect to start withdrawing money, not the year we expect to expire. I expect that I will not be withdrawing much money the year I expire, and certainly none afterwards. So why do you word your advice that way?
A. Because I believe that the suggested method for choosing the L Funds will lead you to invest too conservatively to maximize the lifetime income your TSP account will support.

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