Reply to Fed Employees- Asset allocation given pension

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]Look at the allocation of L2040.

The life cycle funds are based on your retirement year, and they allocate the funds in a way that’s appropriate for the year of your retirement.

https://www.tsp.gov/funds-lifecycle/[/quote]

yeah but fees are pretty high compared to CSI. i don't know if the money managers who came up with L funds factored in pension and SS in their allocations. [/quote]

You don’t know what you are talking about. The S fund is the most expensive fund at .051%, or $51 per 100,000.  The L funds basically charge a blended fee which reflects the costs of the other funds— meaning they cost between .037 and .040%.

Also the whole point of FERS retirement benefits is that they were designed as a “three legged stool” (as opposed to the CSRS stand alone pension)— annuity, TSP and SS. The idea that TSP ignored SS and FERS annuities when designing L funds is ridiculous. [/quote]

You are correct. I stand corrected re. L fund fees. L fund used to be significantly higher (per my memory) than CSI but now I see they are comparable. [/quote]

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