Anonymous
07/25/2015 19:59
Subject: Hating the TSP -- opinions on how to invest?
Anonymous
07/25/2015 19:56
Subject: Hating the TSP -- opinions on how to invest?
Here's some info on the supplement. OPM has info too which you might want to check if you really need definitive info.
http://www.plan-your-federal-retirement.com/fers-supplement.html
http://www.plan-your-federal-retirement.com/fers-supplement.html
Anonymous
07/25/2015 19:42
Subject: Re:Hating the TSP -- opinions on how to invest?
It's not "offered" you've been paying in all along - although a lot of members of congress would like to cut these benefits
It's not nearly as generous as the old system
I don't understand the social security supplement so if PP is still around please elaborate
It's not nearly as generous as the old system
I don't understand the social security supplement so if PP is still around please elaborate
Anonymous
07/25/2015 19:40
Subject: Hating the TSP -- opinions on how to invest?
My vague recollection of the reason for the supplement is that when they moved from CSRS to FERS they were trying to bring people into the SS system without really reducing the overall retirement benefits.
The combination of FERS plus SS plus TSP match was supposed to be as good as a CSRS pension. Since feds could retire at 57 but SS did not begin until 62, they provided a temporary supplement to FERS until SS kicks in.
The combination of FERS plus SS plus TSP match was supposed to be as good as a CSRS pension. Since feds could retire at 57 but SS did not begin until 62, they provided a temporary supplement to FERS until SS kicks in.
Anonymous
07/25/2015 18:39
Subject: Hating the TSP -- opinions on how to invest?
Anonymous wrote:Anonymous wrote:Anonymous wrote:There is no better retirement savings vehicle than the TSP. TSP is such a great deal because of the rock-bottom fees that are charged. A majority of mutual funds are linked to the US Total Stock Market, and the market's going to do what it'll do, so paying the tiniest of fees really gives TSP participants a leg-up. The investment industry's average annual fee is 1% (and can go way up from there). Vanguard's, the industry leader, is 0.18%. But the TSP's expense ratio is just 0.03% across all its funds.
https://investor.vanguard.com/mutual-funds/low-cost
And the TSP's G-Fund is practically a free lunch. A short-term bond with long-term rates that NEVER LOSES VALUE? Sign me up, because it's not available anywhere else.
The Fed Dream = Retiring at 57 with 30+ years of service, and then immediately collecting each month a full & unreduced pension + a check from TSP that's drawing down a (hopefully) $2mil+ balance + a $1,300 check from the FERS Social Security Supplement until turning 62. Plus a reasonable-cost health/vision/dental coverage plan for life, along with great survivor benefits too. And then waiting all the way until 70 to collect SS.
But if you're a new fed hired after 01/01/2013, then you're screwed because of FERS-(F)RAE. You get the same pension, but are going to pay a lot more upfront for it.
Can this poster embellish a bit more on "The Fed Dream?" My DH is a federal employee, and he knows the details of retirement, etc. (He's 44 years old with 15 years of service, an annual salary of $158,000, and a TSP balance of $512,000.) Here are a few questions:
(1) Do I understand correctly that, in the FERS system, you get 30% of your highest salary each year in retirement if you worked 30 years?
(2) Is the FERS Social Security Supplement something that you pay for as an optional item?
(3) Do federal employees really get a reasonable-cost health/vision/dental coverage plan for life? (Can you embellish?)
Thank you!
(1) yes = 30% of highest three years
(2) special supplement is automatic if you qualify.
(3) same as what your DH's getting now as a Fed.
Thank you for this input. I don't think my DH will be ready to stop working at 59, but if he did, the SS Supplement is appealing. Having said that, why is this even available to federal employees? It almost seems too good to be true. I'm trying to figure out why it's offered? Thank you.
Anonymous
07/25/2015 17:02
Subject: Hating the TSP -- opinions on how to invest?
Anonymous wrote:Anonymous wrote:There is no better retirement savings vehicle than the TSP. TSP is such a great deal because of the rock-bottom fees that are charged. A majority of mutual funds are linked to the US Total Stock Market, and the market's going to do what it'll do, so paying the tiniest of fees really gives TSP participants a leg-up. The investment industry's average annual fee is 1% (and can go way up from there). Vanguard's, the industry leader, is 0.18%. But the TSP's expense ratio is just 0.03% across all its funds.
https://investor.vanguard.com/mutual-funds/low-cost
And the TSP's G-Fund is practically a free lunch. A short-term bond with long-term rates that NEVER LOSES VALUE? Sign me up, because it's not available anywhere else.
The Fed Dream = Retiring at 57 with 30+ years of service, and then immediately collecting each month a full & unreduced pension + a check from TSP that's drawing down a (hopefully) $2mil+ balance + a $1,300 check from the FERS Social Security Supplement until turning 62. Plus a reasonable-cost health/vision/dental coverage plan for life, along with great survivor benefits too. And then waiting all the way until 70 to collect SS.
But if you're a new fed hired after 01/01/2013, then you're screwed because of FERS-(F)RAE. You get the same pension, but are going to pay a lot more upfront for it.
Can this poster embellish a bit more on "The Fed Dream?" My DH is a federal employee, and he knows the details of retirement, etc. (He's 44 years old with 15 years of service, an annual salary of $158,000, and a TSP balance of $512,000.) Here are a few questions:
(1) Do I understand correctly that, in the FERS system, you get 30% of your highest salary each year in retirement if you worked 30 years?
(2) Is the FERS Social Security Supplement something that you pay for as an optional item?
(3) Do federal employees really get a reasonable-cost health/vision/dental coverage plan for life? (Can you embellish?)
Thank you!
(1) yes = 30% of highest three years
(2) special supplement is automatic if you qualify.
(3) same as what your DH's getting now as a Fed.
Anonymous
07/25/2015 15:29
Subject: Hating the TSP -- opinions on how to invest?
Anonymous wrote:There is no better retirement savings vehicle than the TSP. TSP is such a great deal because of the rock-bottom fees that are charged. A majority of mutual funds are linked to the US Total Stock Market, and the market's going to do what it'll do, so paying the tiniest of fees really gives TSP participants a leg-up. The investment industry's average annual fee is 1% (and can go way up from there). Vanguard's, the industry leader, is 0.18%. But the TSP's expense ratio is just 0.03% across all its funds.
https://investor.vanguard.com/mutual-funds/low-cost
And the TSP's G-Fund is practically a free lunch. A short-term bond with long-term rates that NEVER LOSES VALUE? Sign me up, because it's not available anywhere else.
The Fed Dream = Retiring at 57 with 30+ years of service, and then immediately collecting each month a full & unreduced pension + a check from TSP that's drawing down a (hopefully) $2mil+ balance + a $1,300 check from the FERS Social Security Supplement until turning 62. Plus a reasonable-cost health/vision/dental coverage plan for life, along with great survivor benefits too. And then waiting all the way until 70 to collect SS.
But if you're a new fed hired after 01/01/2013, then you're screwed because of FERS-(F)RAE. You get the same pension, but are going to pay a lot more upfront for it.
Can this poster embellish a bit more on "The Fed Dream?" My DH is a federal employee, and he knows the details of retirement, etc. (He's 44 years old with 15 years of service, an annual salary of $158,000, and a TSP balance of $512,000.) Here are a few questions:
(1) Do I understand correctly that, in the FERS system, you get 30% of your highest salary each year in retirement if you worked 30 years?
(2) Is the FERS Social Security Supplement something that you pay for as an optional item?
(3) Do federal employees really get a reasonable-cost health/vision/dental coverage plan for life? (Can you embellish?)
Thank you!
Anonymous
07/25/2015 15:17
Subject: Hating the TSP -- opinions on how to invest?
Anonymous wrote:Anonymous wrote:Anonymous wrote:I just passed 750k. hoping to pass 1 mil next 3-4 years.
How many years in? I'm at 14 years and have $375k.
NP. I'm 15 years and $450,000. Too conservative early on.
Same for my DH. He's been a federal employee for 15 years (and is 44 years old). He has $512,000 in his account. His annual salary is $158,000. For several years while our kids were younger and I was just doing free-lance, my DH did not contribute the max to his TSP fund (but instead just enough to get the match/agency contribution). In hindsight, I wish of course that we'd found a way to contribute the max for all of the past 15 years. Also, we took a loan out and are still repaying it.
Anonymous
07/25/2015 09:50
Subject: Hating the TSP -- opinions on how to invest?
Correction: S&P500 mimics C, not S.
Anonymous
07/25/2015 09:49
Subject: Hating the TSP -- opinions on how to invest?
If I were you, and young, I'd contribute to the max matching on your TSP first. I'm at 40/40/20 S/C/I; then max out a Roth IRA of your choice. For low fees, a Vanguard S&P500 index would fill the bill, but you're duplicating your coverage with S there. Up to you. Then go back and put as much as you can in the TSP after that.
Benefits:
TSP match = instant 100% return.
TSP in general = reduces your taxable income
Roth IRA = Best from a long-term tax standpoint since all your post 59½ withdrawals will be tax-free.
The only way I'd modify the above is if you're hovering near the border between tax brackets and would use TSP investment to make sure you stay in the lower one. Even then I'd want to run the numbers to see how long-term numbers vary between taxes now & taxes later for the specific amount in question.
Benefits:
TSP match = instant 100% return.
TSP in general = reduces your taxable income
Roth IRA = Best from a long-term tax standpoint since all your post 59½ withdrawals will be tax-free.
The only way I'd modify the above is if you're hovering near the border between tax brackets and would use TSP investment to make sure you stay in the lower one. Even then I'd want to run the numbers to see how long-term numbers vary between taxes now & taxes later for the specific amount in question.
Anonymous
07/24/2015 02:14
Subject: Hating the TSP -- opinions on how to invest?
Anonymous wrote:Anonymous wrote:The fund that tracks the S&P consistently returns less than the S&P - so yeah - the fund choices suck. I think many/most fed govt workers don't understand it - they're just thrilled at the amount they have after maxing out for 30 yrs. Put in the bare minimum to get the match, and then go to a Vanguard or Fidelity IRA - their funds actually manage to beat the market yr after yr, so the cost is worth it.
So clueless. So much bad advice in this post. Taxes not considered. Ignorant of difference between "Vanguard or Fidelity" funds vs. index funds. Completely wrong about any fund beating the market "year after year." Pretty much everything said in this post is wrong ... it's actually so wrong, I suspect it is a troll.
I don't think so. Never ascribe to malice that which can be adequately explained by stupidity. This is one of the risks of the internet - very stupid people giving very bad advice.
But I agree this is terrible, incoherent advice...
Anonymous
07/24/2015 00:55
Subject: Hating the TSP -- opinions on how to invest?
There is no better retirement savings vehicle than the TSP. TSP is such a great deal because of the rock-bottom fees that are charged. A majority of mutual funds are linked to the US Total Stock Market, and the market's going to do what it'll do, so paying the tiniest of fees really gives TSP participants a leg-up. The investment industry's average annual fee is 1% (and can go way up from there). Vanguard's, the industry leader, is 0.18%. But the TSP's expense ratio is just 0.03% across all its funds.
https://investor.vanguard.com/mutual-funds/low-cost
And the TSP's G-Fund is practically a free lunch. A short-term bond with long-term rates that NEVER LOSES VALUE? Sign me up, because it's not available anywhere else.
The Fed Dream = Retiring at 57 with 30+ years of service, and then immediately collecting each month a full & unreduced pension + a check from TSP that's drawing down a (hopefully) $2mil+ balance + a $1,300 check from the FERS Social Security Supplement until turning 62. Plus a reasonable-cost health/vision/dental coverage plan for life, along with great survivor benefits too. And then waiting all the way until 70 to collect SS.
But if you're a new fed hired after 01/01/2013, then you're screwed because of FERS-(F)RAE. You get the same pension, but are going to pay a lot more upfront for it.
https://investor.vanguard.com/mutual-funds/low-cost
And the TSP's G-Fund is practically a free lunch. A short-term bond with long-term rates that NEVER LOSES VALUE? Sign me up, because it's not available anywhere else.
The Fed Dream = Retiring at 57 with 30+ years of service, and then immediately collecting each month a full & unreduced pension + a check from TSP that's drawing down a (hopefully) $2mil+ balance + a $1,300 check from the FERS Social Security Supplement until turning 62. Plus a reasonable-cost health/vision/dental coverage plan for life, along with great survivor benefits too. And then waiting all the way until 70 to collect SS.
But if you're a new fed hired after 01/01/2013, then you're screwed because of FERS-(F)RAE. You get the same pension, but are going to pay a lot more upfront for it.
Anonymous
07/22/2015 11:25
Subject: Hating the TSP -- opinions on how to invest?
Anonymous wrote:Anonymous wrote:Don't forget some people work at agencies with a 10% match and if you make over 180k that is another 18k right there annually.
which one matches 10%??
Probably an independent one. Mine matches 8%.
Anonymous
07/22/2015 11:19
Subject: Hating the TSP -- opinions on how to invest?
Anonymous wrote:Don't forget some people work at agencies with a 10% match and if you make over 180k that is another 18k right there annually.
which one matches 10%??
Anonymous
07/22/2015 11:18
Subject: Hating the TSP -- opinions on how to invest?
Don't forget some people work at agencies with a 10% match and if you make over 180k that is another 18k right there annually.