TSP Allocation Review

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AznSaver
Posts: 33
Joined: Sun Aug 25, 2019 5:51 pm
Location: Seattle, WA

TSP Allocation Review

Post by AznSaver » Thu Nov 07, 2019 10:49 pm

Good Evening Bogleheads,
I'm a fairly new federal employee (5 years in - 2 years of service credit) and wanted to see what other's thought or recommend for my tsp allocation.
The particulars 8% TSP + 5%match/ 2% ROTH TSP
L 2050 10%
G Fund 5%
C Fund 65%
S Fund 20%

I'm 36, single homeowner w/no kiddos. 22% Tax bracket.
I'm wanting an allocation that is pretty aggressive towards growth while having a "bit" of diversity so I'm not leaving anything on the table
I have chosen to not utilize the I / F as I feel they have a history of under performance compared to other offerings. Thoughts?

chevyman38829
Posts: 2
Joined: Wed Nov 06, 2019 7:46 pm

Re: TSP Allocation Review

Post by chevyman38829 » Fri Nov 08, 2019 12:27 am

As a TSP investor myself for 30 years, it is my advice to just go all in the 2050 lifecycle fund in order to get the highest risk adjusted return that is rebalanced daily.

retiredjg
Posts: 38129
Joined: Thu Jan 10, 2008 12:56 pm

Re: TSP Allocation Review

Post by retiredjg » Fri Nov 08, 2019 10:35 am

It's probably ok, but the L funds contain C,S, F, G, and I and are designed to be used alone. It seems you are trying to decrease your allocations to F and I, but there will come a time when those funds are performing well and you will have missed it.

TSR
Posts: 813
Joined: Thu Apr 19, 2012 9:08 am

Re: TSP Allocation Review

Post by TSR » Fri Nov 08, 2019 11:37 am

"A history of underperformance" might mean they continue that way, or it might mean you're "buying low." The one rule you can count on is that past performance does not predict future results. Do yourself a favor and go 100% L2050. First, that fund already has a fairly low allocation to both I and F; second, it will take away your need to watch and tinker. I am 100% L2040 with a substantial amount of funds, and while I enjoy going to the TSP site and seeing how I'm doing far too often, I do not track the individual funds at all. This prevents me from thinking that I'm smarter than the market. Good luck!

rkhusky
Posts: 7366
Joined: Thu Aug 18, 2011 8:09 pm

Re: TSP Allocation Review

Post by rkhusky » Fri Nov 08, 2019 11:45 am

F has outperformed G since inception, which is expected since it is more volatile, even accounting for G’s special properties.

Go 100% L2050 in the TSP and 100% Emerging Markets in your Roth IRA.

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