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Re: [TSPStrategy] Lower Your Taxable Income

That's one way to beat the impending hyperinflation, debt default, and monetary devaluation...

Re: [TSPStrategy] Lower Your Taxable Income

Good Lord, it's better to just die.

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Re: [TSPStrategy] Lower Your Taxable Income

If you retire , your account will be frozen after retirement date. You are no longer able to submit claims for your remaining fund on your account. Please make a note of it.

Sent from my Galaxy

-------- Original message --------

From: "sarah_oz via groups.io" <sarah_oz=yahoo.com@groups.io>

Date: 5/29/21 4:42 PM (GMT-05:00)

To: TSPStrategy@groups.io

Subject: [TSPStrategy] Lower Your Taxable Income

A Mid-Year Chance to Lower Your Taxable Income

By Tammy Flanagan

May 27, 2021

By now, you may have been notified that during the month of June, federal employees will have another opportunity to enroll in the Federal Flexible Spending Account Program (FSAFEDS), or make midyear changes to their accounts if they're already enrolled. This is the same type of rare mid-year open enrollment period that happened last year after the onset of the Covid-19 pandemic.

According to the Office of Personnel Management, out of more than 2 million federal employees, less than a quarter (443,334) had Health Care Flexible Spending Accounts in fiscal 2020; less than 5% (90,388) had Dependent Care Flexible Spending Accounts; and about a half of 1% (10,406) had Limited Expense Health Care Flexible Spending Accounts, which are available to employees who are enrolled in a high deductible health plan with a health savings account. By comparison, almost all federal workers are enrolled in the Federal Employees Health Benefits Program.

The funds put into an FSA are not subject to federal income or Social Security taxes, and also are exempt from most state or local income taxes. So why don't more employees use them? One reason is that it's difficult to estimate your out of pocket health care expenses for the upcoming year in November or December of the previous year during the regular open season period. Here's your chance to make an election when the year is already almost halfway over.

The American Rescue Plan Act, signed into law on March 11, raised the limit on maximum contributions for pre-tax earnings to a dependent care flexible spending account from $5,000 to $10,500 (for single or married filing jointly) and from $2,500 to $5,250 (for married filing separately). Here are some things to know about the upcoming mid-year open enrollment opportunity:

New enrollments for the 2021 plan year are allowed via FSAFEDS.com.
All participants who have already enrolled in a 2021 HCFSA, LEX HCFSA, or DCFSA will be allowed to make a one-time change (increase or decrease) in the amount of their annual election in each FSA account in which they are enrolled. Participants can't increase the amount of their elections in excess of annual contribution limits. Employees who decrease their election won't receive a refund of allotments from pay they have already made to their FSA accounts.
Funds that may have been forfeited in an HCFSA or LEX HCFSA at the end of 2020 (generally, participants are only permitted to carry over $550 to the new year) will be restored for current participants, as long as they contribute to an HCFSA or LEX HCFSA in 2021. Current participants can use the full 2020 plan year carryover amount in addition to the maximum 2021 plan year account contribution (currently, $2,750) for reimbursement of expenses incurred at any time from Jan. 1, 2021 forward. Newly enrolled participants can only utilize unused 2020 plan year carryover funds for expenses incurred following the date of their new enrollment next month.
Under the new flexibilities, the maximum age for eligible dependent children under a DCFSA is increased from those under age 13 to those under age 14 for the 2020 plan year. All unused funds that were available at the end of 2020 can be used for an aged-out dependent child until that dependent turns 14 and for dependents who turn 13 during 2021.
For employees who participate in a DCFSA, the March 15, 2021 grace period to use remaining 2020 funds has been extended to Dec. 31.
If you have DCFSA funds remaining at the end of 2021, you will now be allowed to use the remaining funds to be reimbursed for eligible expenses incurred through Dec. 31, 2022.
You don't have to take any action to be permitted these flexibilities; the extended grace period for incurring expenses through the end of 2020 has been applied to your account automatically by FSAFEDS and will also be automatically applied for 2021.
If you'd like to accelerate your allotments now because you are increasing your election, you can do this by logging into your online account and adjusting the number of pay periods.

By Tammy Flanagan

May 27, 2021

https://www.govexec.com/pay-benefits/2021/05/mid-year-chance-lower-your-taxable-income/174367/

[TSPStrategy] Lower Your Taxable Income

A Mid-Year Chance to Lower Your Taxable Income

By Tammy Flanagan

May 27, 2021

By now, you may have been notified that during the month of June, federal employees will have another opportunity to enroll in the Federal Flexible Spending Account Program (FSAFEDS), or make midyear changes to their accounts if they’re already enrolled. This is the same type of rare mid-year open enrollment period that happened last year after the onset of the Covid-19 pandemic.

The funds put into an FSA are not subject to federal income or Social Security taxes, and also are exempt from most state or local income taxes. So why don’t more employees use them? One reason is that it’s difficult to estimate your out of pocket health care expenses for the upcoming year in November or December of the previous year during the regular open season period. Here’s your chance to make an election when the year is already almost halfway over.

New enrollments for the 2021 plan year are allowed via FSAFEDS.com.
All participants who have already enrolled in a 2021 HCFSA, LEX HCFSA, or DCFSA will be allowed to make a one-time change (increase or decrease) in the amount of their annual election in each FSA account in which they are enrolled. Participants can’t increase the amount of their elections in excess of annual contribution limits. Employees who decrease their election won’t receive a refund of allotments from pay they have already made to their FSA accounts.
Funds that may have been forfeited in an HCFSA or LEX HCFSA at the end of 2020 (generally, participants are only permitted to carry over $550 to the new year) will be restored for current participants, as long as they contribute to an HCFSA or LEX HCFSA in 2021. Current participants can use the full 2020 plan year carryover amount in addition to the maximum 2021 plan year account contribution (currently, $2,750) for reimbursement of expenses incurred at any time from Jan. 1, 2021 forward. Newly enrolled participants can only utilize unused 2020 plan year carryover funds for expenses incurred following the date of their new enrollment next month.
Under the new flexibilities, the maximum age for eligible dependent children under a DCFSA is increased from those under age 13 to those under age 14 for the 2020 plan year. All unused funds that were available at the end of 2020 can be used for an aged-out dependent child until that dependent turns 14 and for dependents who turn 13 during 2021.
For employees who participate in a DCFSA, the March 15, 2021 grace period to use remaining 2020 funds has been extended to Dec. 31.
If you have DCFSA funds remaining at the end of 2021, you will now be allowed to use the remaining funds to be reimbursed for eligible expenses incurred through Dec. 31, 2022.
You don’t have to take any action to be permitted these flexibilities; the extended grace period for incurring expenses through the end of 2020 has been applied to your account automatically by FSAFEDS and will also be automatically applied for 2021.
If you’d like to accelerate your allotments now because you are increasing your election, you can do this by logging into your online account and adjusting the number of pay periods.

By Tammy Flanagan

May 27, 2021

https://www.govexec.com/pay-benefits/2021/05/mid-year-chance-lower-your-taxable-income/174367/

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Re: [TSPStrategy] Off Topic: MyPay & Medical Savings Plans

Bill- I've been retired 7 years so things have changed. I thought the HSA (health saving account) was a tax deferred option for a high deductible health plan. The FSAFEDS account was another option to use non-taxed funds for your out of pocket medical expense. I had an FSAFEDS account with my BCBS health care plan. I could be wrong but under the impression they are two different things. Do you have an option to look at the balance in your FSAFEDS account? Good Luck, Ken

-----Original Message-----
From: bill_steele_sr via groups.io <bill_steele_sr=yahoo.com@groups.io>
To: TSPStrategy@groups.io
Sent: Sun, May 23, 2021 5:25 pm
Subject: [TSPStrategy] Off Topic: MyPay & Medical Savings Plans

Hi All,

I was just in MyPay and noticed a link for Medical Savings Plans. When I clicked it this pop-up appeared ~ No Health Savings Account data on record, please add a new account:~. I've had the FSAFEDS since open season, and I regularly get notices in my email each time I get a reimbursement. My question though is 1) Why doesn't MyPay know I have and account, and 2) Is there a problem with the fact that they don't know I have an account- in other words is this fact going to somehow erase my tax savings, etc. Thanks!

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Re: [TSPStrategy] Off Topic: MyPay & Medical Savings Plans

@Bill,
It's been awhile since I was in MyPay, but it may be that since MyPay is also for DOD (and originally was only for DOD), that FSAFEDS is not included there. Isn't FSAFEDS only for civilian federal service? And isn't it listed on the FSAFEDS site?

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[TSPStrategy] Off Topic: MyPay & Medical Savings Plans

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Re: [TSPStrategy] Off Topic: FSAFEDS in Retirement

Right on Bill, no problem, I think ranting is good for the soul. Despite all the alphabet soup, excess verbiage, and clumsy bureaucracy, I (on my better days) am very grateful for the fruits of my 25 yrs of Federal service. Best of luck to ya Bill !

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Re: [TSPStrategy] Off Topic: FSAFEDS in Retirement

Thanks folks. Mark- I read your link for a while until my eyes glazed over- but I did indeed see that Medicare shoots us in the foot. I am amazed at the minds that concoct and write the endless torrent of government regulations- most of which, as a regular working stiff, seem to me to be mostly designed to tell us what we Can't Have. Compared to the amount we put into "The System" over the course of working 50 years we seem to get very little back. Sorry- I got on my horse and went off at full speed.

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Re: [TSPStrategy] Off Topic: FSAFEDS in Retirement

I don't think so Bill. I retired in 2017, with Fed Annuity, TSP distributions, and delayed SS until 2019 (when I was 70). I remember no longer being eligible for HSA once I claimed Medicare. I find it exasperatingly complicated with all of the alphabet soup but I became convinced that Medicare ended my eligibility for all those strategies. Here is the IRS pub on that: https://www.irs.gov/publications/p969

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Re: [TSPStrategy] Off Topic: FSAFEDS in Retirement

OPM says FSAs are a salary benefit and annuities are not salary.

https://www.opm.gov/FAQs/QA.aspx?fid=fd635746-de0a-4dd7-997d-b5706a0fd8d2&pid=d4d64b29-fd91-4b8b-a113-fc615f97880d&result=1

On Wed, May 19, 2021, 10:58 AM bill_steele_sr via groups.io <bill_steele_sr=yahoo.com@groups.io> wrote:

Thanks for your reply. I'll expand my question a bit. Since Social Security, Federal Pensions, and TSP are considered income- and are taxed; is there a Medical Savings Account that allows us to put aside pre-tax dollars of retirement income?

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Re: [TSPStrategy] Off Topic: FSAFEDS in Retirement

Thanks for your reply. I'll expand my question a bit. Since Social Security, Federal Pensions, and TSP are considered income- and are taxed; is there a Medical Savings Account that allows us to put aside pre-tax dollars of retirement income?

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Re: [TSPStrategy] Off Topic: FSAFEDS in Retirement

I believe all those medical savings accounts uses pre-tax dollars from income.

On Tuesday, May 18, 2021, 10:21:09 PM MDT, bill_steele_sr via groups.io <bill_steele_sr=yahoo.com@groups.io> wrote:

Can we use this program in retirement? If not this one- are there any Medical Savings Accounts that are available in retirement?

Thanks

[TSPStrategy] Off Topic: FSAFEDS in Retirement

Can we use this program in retirement? If not this one- are there any Medical Savings Accounts that are available in retirement?

Thanks

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Re: [TSPStrategy] Milestones Towards Financial Security in Retirement

At the bottom of the table on the last page, there is an example calculation.

https://www.tsp.gov/publications/tsp-775.pdf

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Re: [TSPStrategy] Milestones Towards Financial Security in Retirement

Thank you for the reminders. Is there a formula or calculator for RMD?

Sky

831 262-8044

On May 15, 2021, at 12:36 PM, sarah_oz via groups.io <sarah_oz=yahoo.com@groups.io> wrote:

Milestones on the Path to Financial Security in Retirement

By Tammy Flanagan

May 13, 2021

There are lots of milestones in life: Getting a driver's license, voting for the first time, buying your first beer (legally), getting married, moving to a new home and, of course, retirement. Along the way, if you work in the federal government, there are milestone moments that are important in the retirement planning process. Let's look at some of them.

Retirement Eligibility and the Five-Year Rule

Do you know how old you must be and how much service you need to become eligible to retire from your federal career? Some employees will reach their minimum retirement age before they have enough service to retire. Others—especially those who joined the civil service right out of college—will have the service time needed before they're old enough to claim their their immediate retirement benefit. You can learn more about retirement eligibility at the Office of Personnel Management's website.

Remember that to continue your health and life insurance benefits in retirement, you must be enrolled for the five years immediately preceding your retirement. Consider enrolling five years before you're eligible for retirement if you are not already covered to be sure you will have these valuable benefits along with your government pension.

Every Five Years

The rates for Options A, B, and C of Federal Employees Group Life Insurance increase every five years. Take time to reevaluate your need for life insurance compared with the cost of continuing coverage. Read the FEGLI Program Booklet for Federal Employees (or postal employees) and review the FEGLI Handbook. The FEGLI Calculator can help you figure out your coverage and premiums. Contact your human resources office if you have additional questions. You can cancel some of your FEGLI coverage at any time if it becomes more expensive than what it's worth to you.

Age 45-55

You can purchase long-term care insurance at almost any age, as long as you can pass the medical underwriting. But the younger you are at the time of purchase, the easier it will be to pass the health portion of the application and the less expensive your premiums will be.

Age 50

This is the age when you can begin making catch-up contributions to your Thrift Savings Plan account above the annual elective deferral limit. The combined total of traditional and Roth contributions cannot exceed $19,500 in 2021. However, beginning in the year you turn 50 you can contribute as much as $6,500 above this amount each year. These amounts may change in future years.

Age 55

If you separate from federal service in the year you reach age 55 (or later), you can take penalty-free distributions from your TSP account. If you separate from federal service before 55, you might have to pay an early withdrawal penalty tax equal to 10% of any taxable portion of the distribution not transferred or rolled over that is withdrawn prior to age 59½. The TSP has a fact sheet, Important Tax Information About Payments from Your TSP Account, which explains this and much more about taxes and the TSP.

Age 59 ½

Once you reach age 59½, withdrawals from employer-sponsored retirement plans (if you separated before age 55 and didn't meet an exception) and IRAs are no longer subject to the 10% early withdrawal tax. You still might owe regular income tax on the distributions.

Age 62

This is your first eligibility for Social Security retirement benefits. Keep in mind that you can delay Social Security until as late as age 70 to earn a larger benefit. Even if you are no longer working, the benefit payable at age 62 is permanently reduced by 30 percent (for those born before 1960, the reduction is less). If you wait to claim Social Security beyond your full retirement age (age 67 for those born in 1960 or later), you'll get an increase in your benefit for every year you delayed.

Under FERS, if you retire at age 62 or later and have at least 20 years of creditable service, your retirement benefit will be computed using a 1.1 percent multiplier rather than 1.0 percent. This results in a permanent 10 percent increase in your FERS benefit.

Age 65

Your initial enrollment period for Medicare starts three months before your 65th birthday and ends three months after. If you are employed and covered by health insurance through your employment or if you are covered by your spouse's health benefits and they are still employed, you can delay Medicare enrollment past age 65 without a late enrollment penalty. There is a special enrollment period that follows your retirement for eight months.

Age 72

Individuals must begin taking required minimum distributions from traditional and Roth TSP accounts starting at age 72. You can defer your first RMD until April 1 of the year after you turn 72, but then you're required to take two distributions in that year. If you don't withdraw enough to meet the requirement during your first distribution calendar year, the TSP is required to disburse your first RMD to you by April 1 of the following year.

Are you nearing one of these milestones? If so, take the time to learn more about your benefits and take action if necessary to be sure you're getting the full value of your federal retirement benefits before and after retirement.

By Tammy Flanagan

May 13, 2021

https://www.govexec.com/pay-benefits/2021/05/milestones-path-financial-security-retirement/174031/

[TSPStrategy] Milestones Towards Financial Security in Retirement

Milestones on the Path to Financial Security in Retirement

By Tammy Flanagan

May 13, 2021

There are lots of milestones in life: Getting a driver's license, voting for the first time, buying your first beer (legally), getting married, moving to a new home and, of course, retirement. Along the way, if you work in the federal government, there are milestone moments that are important in the retirement planning process. Let’s look at some of them.

Retirement Eligibility and the Five-Year Rule

Do you know how old you must be and how much service you need to become eligible to retire from your federal career? Some employees will reach their minimum retirement age before they have enough service to retire. Others—especially those who joined the civil service right out of college—will have the service time needed before they’re old enough to claim their their immediate retirement benefit. You can learn more about retirement eligibility at the Office of Personnel Management’s website.

Remember that to continue your health and life insurance benefits in retirement, you must be enrolled for the five years immediately preceding your retirement. Consider enrolling five years before you’re eligible for retirement if you are not already covered to be sure you will have these valuable benefits along with your government pension.

Every Five Years

The rates for Options A, B, and C of Federal Employees Group Life Insurance increase every five years. Take time to reevaluate your need for life insurance compared with the cost of continuing coverage. Read the FEGLI Program Booklet for Federal Employees (or postal employees) and review the FEGLI Handbook. The FEGLI Calculator can help you figure out your coverage and premiums. Contact your human resources office if you have additional questions. You can cancel some of your FEGLI coverage at any time if it becomes more expensive than what it’s worth to you.

Age 45-55

You can purchase long-term care insurance at almost any age, as long as you can pass the medical underwriting. But the younger you are at the time of purchase, the easier it will be to pass the health portion of the application and the less expensive your premiums will be.

Age 50

This is the age when you can begin making catch-up contributions to your Thrift Savings Plan account above the annual elective deferral limit. The combined total of traditional and Roth contributions cannot exceed $19,500 in 2021. However, beginning in the year you turn 50 you can contribute as much as $6,500 above this amount each year. These amounts may change in future years.

Age 55

If you separate from federal service in the year you reach age 55 (or later), you can take penalty-free distributions from your TSP account. If you separate from federal service before 55, you might have to pay an early withdrawal penalty tax equal to 10% of any taxable portion of the distribution not transferred or rolled over that is withdrawn prior to age 59½. The TSP has a fact sheet, Important Tax Information About Payments from Your TSP Account, which explains this and much more about taxes and the TSP.

Age 59 ½

Once you reach age 59½, withdrawals from employer-sponsored retirement plans (if you separated before age 55 and didn’t meet an exception) and IRAs are no longer subject to the 10% early withdrawal tax. You still might owe regular income tax on the distributions.

Age 62

This is your first eligibility for Social Security retirement benefits. Keep in mind that you can delay Social Security until as late as age 70 to earn a larger benefit. Even if you are no longer working, the benefit payable at age 62 is permanently reduced by 30 percent (for those born before 1960, the reduction is less). If you wait to claim Social Security beyond your full retirement age (age 67 for those born in 1960 or later), you’ll get an increase in your benefit for every year you delayed.

Under FERS, if you retire at age 62 or later and have at least 20 years of creditable service, your retirement benefit will be computed using a 1.1 percent multiplier rather than 1.0 percent. This results in a permanent 10 percent increase in your FERS benefit.

Age 65

Your initial enrollment period for Medicare starts three months before your 65th birthday and ends three months after. If you are employed and covered by health insurance through your employment or if you are covered by your spouse’s health benefits and they are still employed, you can delay Medicare enrollment past age 65 without a late enrollment penalty. There is a special enrollment period that follows your retirement for eight months.

Age 72

Individuals must begin taking required minimum distributions from traditional and Roth TSP accounts starting at age 72. You can defer your first RMD until April 1 of the year after you turn 72, but then you're required to take two distributions in that year. If you don’t withdraw enough to meet the requirement during your first distribution calendar year, the TSP is required to disburse your first RMD to you by April 1 of the following year.

Are you nearing one of these milestones? If so, take the time to learn more about your benefits and take action if necessary to be sure you’re getting the full value of your federal retirement benefits before and after retirement.

By Tammy Flanagan

May 13, 2021

https://www.govexec.com/pay-benefits/2021/05/milestones-path-financial-security-retirement/174031/

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Re: [TSPStrategy] change of asset allocation

Good points Richard. Calling a bottom is just as much a crapshoot as going back in now. As to your point about external things (black swans, etc) causing markets to tank, I wonder how many more cyber attacks like Friday's the economy and the market can tolerate. This may be an interesting week.

John

On May 7, 2021, at 10:42 PM, MD2018 via groups.io <rlkane.wc=verizon.net@groups.io> wrote:

Not sure about Sara, I've following her off and on since back in the time when she was part of TSP Center. She was much more outspoken at that site. However I can tell that she does stick to her guns and when she went into S years ago she stayed firm while stimulus and low interest rates were in affect by the Fed. I am not sure what her motivations are currently since stimulus was continued and interest rates are at zero. However it may just be in the long term that the market just may not have that much more room to go and if anything external happens to cause the market to tank what other tools does the fed have in the tool box at this point? So I can see the wisdom in playing it safe for awhile. I've more than once bought into the market when it was 10% down only to absorb another 10-20% down and had to wait it out.

Richard

On May 7, 2021, at 8:41 PM, JOHN HOLLIS via groups.io <John.hollis_oo4=yahoo.com@groups.io> wrote:

That sounds very reasonable. I wonder what Sara is doing/thinking. Since she hasn't provided any relevant updates since December, I first hope she's ok, and second, wonder if she is sticking by her original recommendation to stay in G because things are too volatile and not as they may seem.

On May 7, 2021, at 7:45 PM, MD2018 via groups.io <rlkane.wc=verizon.net@groups.io> wrote:

It really depends on your retirement time horizons and risk tolerance. If you have plenty of time before retirement, say 10 years or more it's not really that big of a risk. If the market tanks and your in it then wait it out and it will recover. And if it does tank you know the politicians will just borrow more money to add more stimulus. But if you need the money soon then your risk is much higher. I would bet it goes higher eventually even it it takes a short term correction in the near future. I'm retired but do not need by TSP yet but am only 30% in the equities, 20% bonds, and 50% G. I'm satisfied making a little bit with not huge risk based on my risk tolerance.

-----Original Message-----
From: JOHN HOLLIS via groups.io <John.hollis_oo4=yahoo.com@groups.io>
To: TSPStrategy@groups.io
Sent: Fri, May 7, 2021 6:52 pm
Subject: Re: [TSPStrategy] change of asset allocation

Honestly, I don't know what to expect. All I know is corrections are normal occurrences and we haven't had one in a while. The October drop was the closest we came to one, but it didn't qualify. Just saying I'll wait for the one that should come sooner or later this year. I'm not the youngest anymore and have been burned before by jumping in when all systems seemed to say go and the rocket suddenly fizzled. Good luck!

On May 7, 2021, at 3:53 PM, Mark Morrison <mark3m@swbell.net> wrote:

@Hollis, A correction is 10% or more pullback. Do you expect a correction anytime in the near future with a stimulated and recovering economy?

Re: [TSPStrategy] questions on previous post: remote video session?

@Tex: Over the years you have contributed insightful analyses of investing on this forum. I, for one, have benefited from your posts. Best of luck with your recovery from the "minor cyclone". I understand how stressful that can be.

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Re: [TSPStrategy] questions on previous post: remote video session?

Hi,

As I said in the previous post on a new asset allocation, there were a lot of good questions, which I do not want to answer individually. All I can think of is a remote video session. I have never set one up but I believe that ZOOM costs money if we have above a specific amount. There is Google Meet (?), which is probably free.

Zoom allows one to turn off the camera, so anonymity is preserved if desired. I suspect that clever programmers can get around that, but I don't really care.

I am not excited about doing such a thing. Also some of the questions have already been answered in my previous post, if one reads it carefully. If a term like earnings yield is confusing, then one can easily do an Internet search for further information. The point of the approach is that yield is a form of "owner earnings" which Warren Buffett uses as a measure of return on investment.

Finally, toward the end of the thread, I believe that my thoughts were superseded by other folks, which again is fine with me. I am still recovering from the minor cyclone event that wiped out power and Internet and caused minor damage to our house via a neighbor's fallen tree. So I really don't have a lot of time for a while.

Good luck,
Tex

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[TSPStrategy] Lessons Learned Growing a TSP Balance Beyond $1M

https://www.fedweek.com/tsp/lessons-learned-growing-a-tsp-balance-beyond-1m/

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Re: [TSPStrategy] change of asset allocation

Not sure about Sara, I've following her off and on since back in the time when she was part of TSP Center. She was much more outspoken at that site. However I can tell that she does stick to her guns and when she went into S years ago she stayed firm while stimulus and low interest rates were in affect by the Fed. I am not sure what her motivations are currently since stimulus was continued and interest rates are at zero. However it may just be in the long term that the market just may not have that much more room to go and if anything external happens to cause the market to tank what other tools does the fed have in the tool box at this point? So I can see the wisdom in playing it safe for awhile. I've more than once bought into the market when it was 10% down only to absorb another 10-20% down and had to wait it out.

Richard

On May 7, 2021, at 8:41 PM, JOHN HOLLIS via groups.io <John.hollis_oo4=yahoo.com@groups.io> wrote:

That sounds very reasonable. I wonder what Sara is doing/thinking. Since she hasn't provided any relevant updates since December, I first hope she's ok, and second, wonder if she is sticking by her original recommendation to stay in G because things are too volatile and not as they may seem.

On May 7, 2021, at 7:45 PM, MD2018 via groups.io <rlkane.wc=verizon.net@groups.io> wrote:

It really depends on your retirement time horizons and risk tolerance. If you have plenty of time before retirement, say 10 years or more it's not really that big of a risk. If the market tanks and your in it then wait it out and it will recover. And if it does tank you know the politicians will just borrow more money to add more stimulus. But if you need the money soon then your risk is much higher. I would bet it goes higher eventually even it it takes a short term correction in the near future. I'm retired but do not need by TSP yet but am only 30% in the equities, 20% bonds, and 50% G. I'm satisfied making a little bit with not huge risk based on my risk tolerance.

-----Original Message-----
From: JOHN HOLLIS via groups.io <John.hollis_oo4=yahoo.com@groups.io>
To: TSPStrategy@groups.io
Sent: Fri, May 7, 2021 6:52 pm
Subject: Re: [TSPStrategy] change of asset allocation

Honestly, I don't know what to expect. All I know is corrections are normal occurrences and we haven't had one in a while. The October drop was the closest we came to one, but it didn't qualify. Just saying I'll wait for the one that should come sooner or later this year. I'm not the youngest anymore and have been burned before by jumping in when all systems seemed to say go and the rocket suddenly fizzled. Good luck!

On May 7, 2021, at 3:53 PM, Mark Morrison <mark3m@swbell.net> wrote:

@Hollis, A correction is 10% or more pullback. Do you expect a correction anytime in the near future with a stimulated and recovering economy?

Re: [TSPStrategy] change of asset allocation

That sounds very reasonable. I wonder what Sara is doing/thinking. Since she hasn't provided any relevant updates since December, I first hope she's ok, and second, wonder if she is sticking by her original recommendation to stay in G because things are too volatile and not as they may seem.

On May 7, 2021, at 7:45 PM, MD2018 via groups.io <rlkane.wc=verizon.net@groups.io> wrote:

It really depends on your retirement time horizons and risk tolerance. If you have plenty of time before retirement, say 10 years or more it's not really that big of a risk. If the market tanks and your in it then wait it out and it will recover. And if it does tank you know the politicians will just borrow more money to add more stimulus. But if you need the money soon then your risk is much higher. I would bet it goes higher eventually even it it takes a short term correction in the near future. I'm retired but do not need by TSP yet but am only 30% in the equities, 20% bonds, and 50% G. I'm satisfied making a little bit with not huge risk based on my risk tolerance.

-----Original Message-----
From: JOHN HOLLIS via groups.io <John.hollis_oo4=yahoo.com@groups.io>
To: TSPStrategy@groups.io
Sent: Fri, May 7, 2021 6:52 pm
Subject: Re: [TSPStrategy] change of asset allocation

Honestly, I don't know what to expect. All I know is corrections are normal occurrences and we haven't had one in a while. The October drop was the closest we came to one, but it didn't qualify. Just saying I'll wait for the one that should come sooner or later this year. I'm not the youngest anymore and have been burned before by jumping in when all systems seemed to say go and the rocket suddenly fizzled. Good luck!

On May 7, 2021, at 3:53 PM, Mark Morrison <mark3m@swbell.net> wrote:

@Hollis, A correction is 10% or more pullback. Do you expect a correction anytime in the near future with a stimulated and recovering economy?

Re: [TSPStrategy] change of asset allocation

It really depends on your retirement time horizons and risk tolerance. If you have plenty of time before retirement, say 10 years or more it's not really that big of a risk. If the market tanks and your in it then wait it out and it will recover. And if it does tank you know the politicians will just borrow more money to add more stimulus. But if you need the money soon then your risk is much higher. I would bet it goes higher eventually even it it takes a short term correction in the near future. I'm retired but do not need by TSP yet but am only 30% in the equities, 20% bonds, and 50% G. I'm satisfied making a little bit with not huge risk based on my risk tolerance.

-----Original Message-----
From: JOHN HOLLIS via groups.io <John.hollis_oo4=yahoo.com@groups.io>
To: TSPStrategy@groups.io
Sent: Fri, May 7, 2021 6:52 pm
Subject: Re: [TSPStrategy] change of asset allocation

Honestly, I don't know what to expect. All I know is corrections are normal occurrences and we haven't had one in a while. The October drop was the closest we came to one, but it didn't qualify. Just saying I'll wait for the one that should come sooner or later this year. I'm not the youngest anymore and have been burned before by jumping in when all systems seemed to say go and the rocket suddenly fizzled. Good luck!

On May 7, 2021, at 3:53 PM, Mark Morrison <mark3m@swbell.net> wrote:

@Hollis, A correction is 10% or more pullback. Do you expect a correction anytime in the near future with a stimulated and recovering economy?

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Re: [TSPStrategy] change of asset allocation

On May 7, 2021, at 3:53 PM, Mark Morrison <mark3m@swbell.net> wrote:

@Hollis, A correction is 10% or more pullback. Do you expect a correction anytime in the near future with a stimulated and recovering economy?

Re: [TSPStrategy] change of asset allocation

@Hollis, A correction is 10% or more pullback. Do you expect a correction anytime in the near future with a stimulated and recovering economy?

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Re: [TSPStrategy] change of asset allocation

Personally, if I had stayed in stocks since December, I'd 1) be very happy I did, and 2) consider going to G right about now to catch my breath (I'm 60). But since I've been in G like many of you, I'm just waiting for a true correction (not just a dip) to get back in. As Powell and other economists are saying, equities are too 'frothy' right now. Good that we have a unique and safe G fund unlike other people whose 401K's only offer longer term bond funds (like F) as alternatives to equities. Those bonds will keep losing value as yields rise.

John Hollis

john.hollis_oo4@yahoo.com

On Friday, May 7, 2021, 09:11:21 AM EDT, <caramall444@gmail.com> wrote:

Thanks Tex. If you weren't risk adverse/retired what do you think you'd suggest right now for a 100% G person?

I think the main thing that I didn't think through in December was that everything is coming out of Covid impacts and at least in the short term they're also injecting money into the economy. I think this is a bad idea long-term but I think I could've expected at least a few months of continued uptick. Hindsight is always 20/20 :-)

Re: [TSPStrategy] change of asset allocation

Thanks Tex. If you weren’t risk adverse/retired what do you think you’d suggest right now for a 100% G person?

I think the main thing that I didn’t think through in December was that everything is coming out of Covid impacts and at least in the short term they’re also injecting money into the economy. I think this is a bad idea long-term but I think I could’ve expected at least a few months of continued uptick. Hindsight is always 20/20 :-)

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Re: [TSPStrategy] change of asset allocation

Is Sara still around? I was on here several yrs ago and was wondering if she is advising to continue to remain in G, despite its extremely low return. Thanks

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Re: [TSPStrategy] change of asset allocation

Thanks Tex.
I am wondering what's your view on basically going all in from G to your allocation versus trying to dollar-cost-average back into the funds over a period of weeks or months (especially given the TSP trading limitations)

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Re: [TSPStrategy] change of asset allocation

Thanks for the info, Tex !

On Wed, May 5, 2021, 8:34 PM KC Will via groups.io <kcwill64114=yahoo.com@groups.io> wrote:

Thank you Tex
I appreciate your thoughts.

KC

On Wed, May 5, 2021 at 1:25 PM, Locutusoftexas
<mrweyl@hotmail.com> wrote:

Fellow board members,

This is FYI because I said that I would do it. I changed my asset allocation last Thursday from 100% G to the following: 12% G, 44% F, 14 % C, 7% S, 23% I. I planned to post it on Friday but we had a local weather disaster and we lost internet until last night. So there it is.

There is "method to the madness" above and I will write it up. It involves the following issues:

(1) I moved from C to G in late December, which was a "trading mistake" since stocks continued up after that.
(2) The P/Es of our domestic stocks are near historic highs and other contrarian signals are flashing red as well. They will turn out to be correct, but no one knows when. So trading them is often very frustrating and, based on some data from Yardeni.com, might be a bad idea. Meanwhile FOMO (fear of missing out) can cause much consternation to people who went to cash and are watching the stock market go up.
(3) In the long term (20 years), buy and hold on stocks is the easy winning play. I came to realize recently that these stock index funds (at least C and probably S) are somewhat optimal, in that the worst performers are replaced by recent top performers that are not in the index. For example, this happens with C for sure apparently several times per year. So holding these funds makes sense as solid assets and as statistical winners because losers are periodically replaced with recent better performers. That is, the funds are not purely unmanaged funds.
(4) Retired people have a shorter horizon, so what do they do if they have been chased out the market by fear (e.g., pandemic, obvious extreme stock valuation)? Hanging tough requires nerves of steel for good reasons. Also it can lead to severe under-performance.

My philosophy underlying the new allocation involves the above issues and is specifically for retired or risk averse people who wish to have some stock holdings, of which I am one. To do this, I estimated the relative earnings yield of the various funds and allocated them according to the estimated earnings yield. I am not willing to go through 5000 stocks (C + S) to estimate these numbers nor will I do so for fixed income. However, enough information is available publicly and in our quarterly TSP reports to compute estimates for the funds. My plan is to lay these out in a document (text or PDF) and attach them to a future message. However, I am unfortunately busy with some other things that have a short time fuse.

Again, this is just FYI. I suggest that people should use their own judgements as to the best allocations and policies should be.

Good luck,
Tex

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Re: [TSPStrategy] change of asset allocation

Thank you Tex

I appreciate your thoughts.

On Wed, May 5, 2021 at 1:25 PM, Locutusoftexas
<mrweyl@hotmail.com> wrote:

Fellow board members,

This is FYI because I said that I would do it. I changed my asset allocation last Thursday from 100% G to the following: 12% G, 44% F, 14 % C, 7% S, 23% I. I planned to post it on Friday but we had a local weather disaster and we lost internet until last night. So there it is.

There is "method to the madness" above and I will write it up. It involves the following issues:

(1) I moved from C to G in late December, which was a "trading mistake" since stocks continued up after that.
(2) The P/Es of our domestic stocks are near historic highs and other contrarian signals are flashing red as well. They will turn out to be correct, but no one knows when. So trading them is often very frustrating and, based on some data from Yardeni.com, might be a bad idea. Meanwhile FOMO (fear of missing out) can cause much consternation to people who went to cash and are watching the stock market go up.
(3) In the long term (20 years), buy and hold on stocks is the easy winning play. I came to realize recently that these stock index funds (at least C and probably S) are somewhat optimal, in that the worst performers are replaced by recent top performers that are not in the index. For example, this happens with C for sure apparently several times per year. So holding these funds makes sense as solid assets and as statistical winners because losers are periodically replaced with recent better performers. That is, the funds are not purely unmanaged funds.
(4) Retired people have a shorter horizon, so what do they do if they have been chased out the market by fear (e.g., pandemic, obvious extreme stock valuation)? Hanging tough requires nerves of steel for good reasons. Also it can lead to severe under-performance.

My philosophy underlying the new allocation involves the above issues and is specifically for retired or risk averse people who wish to have some stock holdings, of which I am one. To do this, I estimated the relative earnings yield of the various funds and allocated them according to the estimated earnings yield. I am not willing to go through 5000 stocks (C + S) to estimate these numbers nor will I do so for fixed income. However, enough information is available publicly and in our quarterly TSP reports to compute estimates for the funds. My plan is to lay these out in a document (text or PDF) and attach them to a future message. However, I am unfortunately busy with some other things that have a short time fuse.

Again, this is just FYI. I suggest that people should use their own judgements as to the best allocations and policies should be.

Good luck,
Tex

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Re: [TSPStrategy] change of asset allocation

Is the I and F strategy buy low?

On Wed, May 5, 2021, 1:25 PM Locutusoftexas <mrweyl@hotmail.com> wrote:

Fellow board members,

This is FYI because I said that I would do it. I changed my asset allocation last Thursday from 100% G to the following: 12% G, 44% F, 14 % C, 7% S, 23% I. I planned to post it on Friday but we had a local weather disaster and we lost internet until last night. So there it is.

There is "method to the madness" above and I will write it up. It involves the following issues:

(1) I moved from C to G in late December, which was a "trading mistake" since stocks continued up after that.
(2) The P/Es of our domestic stocks are near historic highs and other contrarian signals are flashing red as well. They will turn out to be correct, but no one knows when. So trading them is often very frustrating and, based on some data from Yardeni.com, might be a bad idea. Meanwhile FOMO (fear of missing out) can cause much consternation to people who went to cash and are watching the stock market go up.
(3) In the long term (20 years), buy and hold on stocks is the easy winning play. I came to realize recently that these stock index funds (at least C and probably S) are somewhat optimal, in that the worst performers are replaced by recent top performers that are not in the index. For example, this happens with C for sure apparently several times per year. So holding these funds makes sense as solid assets and as statistical winners because losers are periodically replaced with recent better performers. That is, the funds are not purely unmanaged funds.
(4) Retired people have a shorter horizon, so what do they do if they have been chased out the market by fear (e.g., pandemic, obvious extreme stock valuation)? Hanging tough requires nerves of steel for good reasons. Also it can lead to severe under-performance.

My philosophy underlying the new allocation involves the above issues and is specifically for retired or risk averse people who wish to have some stock holdings, of which I am one. To do this, I estimated the relative earnings yield of the various funds and allocated them according to the estimated earnings yield. I am not willing to go through 5000 stocks (C + S) to estimate these numbers nor will I do so for fixed income. However, enough information is available publicly and in our quarterly TSP reports to compute estimates for the funds. My plan is to lay these out in a document (text or PDF) and attach them to a future message. However, I am unfortunately busy with some other things that have a short time fuse.

Again, this is just FYI. I suggest that people should use their own judgements as to the best allocations and policies should be.

Good luck,
Tex

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Re: [TSPStrategy] change of asset allocation

Mr Tex, I too am retired (Aug2017) and moderately risk-averse. Your allocations of 44%F, and 23%I, surprised me. Time allowing, could you give a little more detailed rationale for the weighty allocation of those 2 allocations? Thank you.

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Re: [TSPStrategy] change of asset allocation

Thank you for your input.

Frank

On Wed, May 5, 2021 at 1:25 PM Locutusoftexas <mrweyl@hotmail.com> wrote:

Fellow board members,

This is FYI because I said that I would do it. I changed my asset allocation last Thursday from 100% G to the following: 12% G, 44% F, 14 % C, 7% S, 23% I. I planned to post it on Friday but we had a local weather disaster and we lost internet until last night. So there it is.

There is "method to the madness" above and I will write it up. It involves the following issues:

(1) I moved from C to G in late December, which was a "trading mistake" since stocks continued up after that.
(2) The P/Es of our domestic stocks are near historic highs and other contrarian signals are flashing red as well. They will turn out to be correct, but no one knows when. So trading them is often very frustrating and, based on some data from Yardeni.com, might be a bad idea. Meanwhile FOMO (fear of missing out) can cause much consternation to people who went to cash and are watching the stock market go up.
(3) In the long term (20 years), buy and hold on stocks is the easy winning play. I came to realize recently that these stock index funds (at least C and probably S) are somewhat optimal, in that the worst performers are replaced by recent top performers that are not in the index. For example, this happens with C for sure apparently several times per year. So holding these funds makes sense as solid assets and as statistical winners because losers are periodically replaced with recent better performers. That is, the funds are not purely unmanaged funds.
(4) Retired people have a shorter horizon, so what do they do if they have been chased out the market by fear (e.g., pandemic, obvious extreme stock valuation)? Hanging tough requires nerves of steel for good reasons. Also it can lead to severe under-performance.

My philosophy underlying the new allocation involves the above issues and is specifically for retired or risk averse people who wish to have some stock holdings, of which I am one. To do this, I estimated the relative earnings yield of the various funds and allocated them according to the estimated earnings yield. I am not willing to go through 5000 stocks (C + S) to estimate these numbers nor will I do so for fixed income. However, enough information is available publicly and in our quarterly TSP reports to compute estimates for the funds. My plan is to lay these out in a document (text or PDF) and attach them to a future message. However, I am unfortunately busy with some other things that have a short time fuse.

Again, this is just FYI. I suggest that people should use their own judgements as to the best allocations and policies should be.

Good luck,
Tex

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Re: [TSPStrategy] change of asset allocation

Thank you for your input!

On May 5, 2021, at 1:24 PM, Locutusoftexas <mrweyl@hotmail.com> wrote:

Fellow board members,

This is FYI because I said that I would do it. I changed my asset allocation last Thursday from 100% G to the following: 12% G, 44% F, 14 % C, 7% S, 23% I. I planned to post it on Friday but we had a local weather disaster and we lost internet until last night. So there it is.

There is "method to the madness" above and I will write it up. It involves the following issues:

(1) I moved from C to G in late December, which was a "trading mistake" since stocks continued up after that.
(2) The P/Es of our domestic stocks are near historic highs and other contrarian signals are flashing red as well. They will turn out to be correct, but no one knows when. So trading them is often very frustrating and, based on some data from Yardeni.com, might be a bad idea. Meanwhile FOMO (fear of missing out) can cause much consternation to people who went to cash and are watching the stock market go up.
(3) In the long term (20 years), buy and hold on stocks is the easy winning play. I came to realize recently that these stock index funds (at least C and probably S) are somewhat optimal, in that the worst performers are replaced by recent top performers that are not in the index. For example, this happens with C for sure apparently several times per year. So holding these funds makes sense as solid assets and as statistical winners because losers are periodically replaced with recent better performers. That is, the funds are not purely unmanaged funds.
(4) Retired people have a shorter horizon, so what do they do if they have been chased out the market by fear (e.g., pandemic, obvious extreme stock valuation)? Hanging tough requires nerves of steel for good reasons. Also it can lead to severe under-performance.

My philosophy underlying the new allocation involves the above issues and is specifically for retired or risk averse people who wish to have some stock holdings, of which I am one. To do this, I estimated the relative earnings yield of the various funds and allocated them according to the estimated earnings yield. I am not willing to go through 5000 stocks (C + S) to estimate these numbers nor will I do so for fixed income. However, enough information is available publicly and in our quarterly TSP reports to compute estimates for the funds. My plan is to lay these out in a document (text or PDF) and attach them to a future message. However, I am unfortunately busy with some other things that have a short time fuse.

Again, this is just FYI. I suggest that people should use their own judgements as to the best allocations and policies should be.

Good luck,
Tex

[TSPStrategy] change of asset allocation

Fellow board members,

This is FYI because I said that I would do it. I changed my asset allocation last Thursday from 100% G to the following: 12% G, 44% F, 14 % C, 7% S, 23% I. I planned to post it on Friday but we had a local weather disaster and we lost internet until last night. So there it is.

There is "method to the madness" above and I will write it up. It involves the following issues:

(1) I moved from C to G in late December, which was a "trading mistake" since stocks continued up after that.
(2) The P/Es of our domestic stocks are near historic highs and other contrarian signals are flashing red as well. They will turn out to be correct, but no one knows when. So trading them is often very frustrating and, based on some data from Yardeni.com, might be a bad idea. Meanwhile FOMO (fear of missing out) can cause much consternation to people who went to cash and are watching the stock market go up.
(3) In the long term (20 years), buy and hold on stocks is the easy winning play. I came to realize recently that these stock index funds (at least C and probably S) are somewhat optimal, in that the worst performers are replaced by recent top performers that are not in the index. For example, this happens with C for sure apparently several times per year. So holding these funds makes sense as solid assets and as statistical winners because losers are periodically replaced with recent better performers. That is, the funds are not purely unmanaged funds.
(4) Retired people have a shorter horizon, so what do they do if they have been chased out the market by fear (e.g., pandemic, obvious extreme stock valuation)? Hanging tough requires nerves of steel for good reasons. Also it can lead to severe under-performance.

My philosophy underlying the new allocation involves the above issues and is specifically for retired or risk averse people who wish to have some stock holdings, of which I am one. To do this, I estimated the relative earnings yield of the various funds and allocated them according to the estimated earnings yield. I am not willing to go through 5000 stocks (C + S) to estimate these numbers nor will I do so for fixed income. However, enough information is available publicly and in our quarterly TSP reports to compute estimates for the funds. My plan is to lay these out in a document (text or PDF) and attach them to a future message. However, I am unfortunately busy with some other things that have a short time fuse.

Again, this is just FYI. I suggest that people should use their own judgements as to the best allocations and policies should be.

Good luck,
Tex

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