Hello everyone! I recently switched my TSP from the 2060 fund to C fund 100%. Is this the right call? I’ve done a bit of research and saw that the c fund would bring me much more growth than my current 2060 fund. I have my TSP on Roth and maxing it out at 5% with another 5% being match by the army. Any advice would be greatly appreciated! I’ve been in the army 3 1/2 years and am for sure going to retire. TSP currently has around 7.7k
Posted by Temporary_Ad_5590
7 Comments
We’ll tell you in 20 years lol
It’s not a bad call. I do primarily C fund as well, but past performance doesn’t indicate future results and all that jazz. You’re not wrong to have lifecycle, 100% C, or 80/20 C/S. Someone will have made slightly more money than the others, but we’ll only know with the benefit of hindsight.
We haven’t had a big recession in 16 years, so all the returns over time look weird
If you’re looking at making this a retirement fund, and you’re (I’m guessing) younger (20s-30s) Put as much as you can in the C fund. It’s more risky than other more stable, lower-% growth funds, but the reality is… it’s still pretty solid. Especially if you look at the TSP growth YoY stats for the C fund, you’ll find it’s been pretty strong 9-15% over the past 10 years.
Currently 23.. will be able to retire at 39!
1. Yes it is smart to get out of the L funds due to the time you have until you are even close to retirement age where you can access your TSP.
2. Good job on getting at least 5% in so you can get the match from the Army.
a. You should now make sure you are working to max a ROTH IRA (7,000/yr)
b. Once you accomplish A then you should start increasing your TSP percentage.
3. I am glad you feel you are going to retire from the Army, but at 3.5 years you are only 17.5% towards retirement. Just keep reminding yourself that short-term issues with the Army will be outweighed by the long-term benefits you will get by retiring.
Keep up the good work and motivation!!!
Appreciate the comment! I have family who retired and they practically hounded how good retiring from the military was. Short term bullshit, long term pay off. I have friends who regret doing the initial contract and leaving.
Use the regular military compensation calculator. Add $5,000 to gross civilian equivalent pay to account for free medical care. Then make sure the amount going into TSP is at least 10% *of that number,* ideally 15%.
It should be somewhere between 25-35% of base pay.
If you’re only putting in 5% of base pay, you’re woefully under-funding your account.
As for the question you asked: L fund sucks because of the money put into I. I has a 4.5% average annual return since inception with an 18% standard deviation.
Yes, C is better over the time period you’re looking at (no withdrawals for 40 years).
A lot depends on your risk tolerance. As a young person with lots of time left before retiring, I’d say keep it all in the C fund until you’re at least in your 30s. The more important thing is diversifying between asset classes. Real estate, precious metals, and other real assets are a critical part for reducing risk to your overall wealth.