Current Business Cycle Phase and TSP Allocation.  This monthly update provides my current Thrift Savings Plan allocation and the reasoning behind that allocation strategy.

A Look Forward at TSP Investing in 2018.


1. Introduction to the TSP Allocation Guide.  Start here if this is your first visit to the site for an explanation of what this is all about.

2. Business Cycle Theory of TSP Investing.  An overview of the business cycle, which investments do well during each phase, and how we apply that knowledge in our Thrift Savings Plan allocation strategy.

3. How to Determine the Current Phase of the Business Cycle.  A discussion of the economic indicators used to determine which phase of the business cycle we are in and to forecast upcoming phase changes.



F Fund vs. G Fund in TSP Allocation.  A discussion of the two funds and their very different roles in Thrift Savings Plan allocation strategy.

The TSP I Fund Role in TSP Allocation Strategy.  Making the best of the Thrift Savings Plan’s international fund which is stuck in the 1970s.

Ignore the Noise: Discrete Events and Meaningless Market Volatility.  A discussion of discrete events which cause temporary market movements, and why our Thrift Savings Plan strategy does not react to them.

Traditional vs. Roth TSP.  Understanding which Thrift Savings Plan option is right for you.

Frequently Asked Questions.  A compilation of answers to the most common TSP questions received.

Recommended Reading.  Books I recommend for those who want to explore investing and personal finance in greater depth.

The TSP Loan Guide. A breakdown of when a Thrift Savings Plan loan makes sense, along with the basics of TSP loan eligibility and application.

Debunking the January Barometer Myth. The “January Barometer” accurately predicts negative market returns for the full year following a down January only 33% of the time.

Sell in May and Go Away. This old investing adage is not only bad advice, it can cost you hundreds of thousands of dollars in your Thrift Savings Plan.

Advanced Bond Fund Investing with the Thrift Savings Plan. A strategy for maximizing investments during periods when the TSP F Fund is favored.

Adventures in Bitcoin and Other Cryptocurrencies. A completely off-topic discussion of speculating in cryptocurrencies.


April/May 2018 Update

February/March 2018 Update

December 2017 Update

October/November 2017 Update

August/September 2017 Update

June/July 2017 Update

April/May 2017 Update

March 2017 Update

A Look Forward at TSP Investing in 2017. The annual crystal ball edition of the TSP Allocation Guide in which I make my best guesses about what the year ahead might hold.

December 2016/January 2017 Update

A Trump Presidency and the Thrift Savings Plan

November 2016 Pre-Election Update

September 2016 Update

August 2016 Update

July 2016 Update

June 2016 Update

May 2016 Update

April 2016 Update

March 2016 Update

Warren Buffett’s Annual Letter to Shareholders, February 2016

February 2016 Update

January 2016 Update

A Look Forward at Thrift Savings Plan Investing in 2016.  My forecast for 2016: the economy, risks, opportunities, and what it all means for my Thrift Savings Plan investing.

A Look Back at Thrift Savings Plan Investing in 2015.  A post-mortem on 2015: what I got right and wrong, and whether I should have done anything differently.

December 2015 Update (in which I started transitioning to the TSP C Fund)

November 2015 Update

October 2015 Update

August 2015 Update

July 2015 Update (in which I changed my allocation to include the TSP I Fund)

June 2015 Update

May 2015 Update

April 2015 Update

March 2015 Update

February 2015 Update

Warren Buffett’s Annual Letter to Shareholders, 2014

A Look Forward at Thrift Savings Plan Investing in 2015. My forecast for 2015: the economy, risks, opportunities, and what it all means for my Thrift Savings Plan investing.

Investing Outside the TSP in 2015. Oil stocks, Europe and other speculation. The opportunities I see in individual stocks and sectors outside the Thrift Savings Plan in 2015.

A Look Back at 2014. How we did in 2014, whether we made the right decisions in our Thrift Savings Plan, and how we might do better if we find ourselves in similar circumstances in the future.

December 2014 Update

November 2014 Update

October 2014 Update September 2014 Update

August 2014 Update

July 2014 Update

June 2014 Update

May 2014 Update

April 2014 Update

March 2014 Update

February 2014 Update

Warren Buffett’s Annual Letter to Shareholders. The 2013 yearly writeup from the Oracle of Omaha.

January 2014 Update

December 2013 Update

November 2013 Update

October 2013 Update

Shutdown and Debt Limit Update. Impacts of the current political theater on TSP allocation decisions.

September 2013 Update

August 2013 Update

July 2013 Update

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  1. Hey, thanks for your guide! It really helps a lot to understand the Thrift Savings Plan, especially for starters like me.

    Been in the military for almost 3yrs (USN), 24yrs old, and to be honest I’ve been recently concerned about my financial stability and future (concerned not in a bad way), just being responsible I guess?

    Been working on CDs, investments, small family business, and now my TSP.
    I’ll make sure to read more of your guides and other resources.

    Thanks again!

  2. Hello….I got your link through Dan Jamison. Thank you for this blog!! If you’re ever around Quantico I’ll buy lunch!!

  3. Great blog! Wishing I had found it 3 years ago, glad I didn’t find it 20 years from now! Anyway, I was curious if you had a resource recommendation that could help me select sound non-TSP investments for my IRA and other accounts? Thanks!

  4. I wish I had started it three years ago! In an effort to keep things very simple, my IRAs are typically invested in the Vanguard equivalent to the TSP Fund(s) in which I am currently invested. I think I have all of those identified somewhere in the various posts on the site, but I will make a point of pulling together a list under resources in the near future and noting those funds in future updates.

  5. As a young fed I very much appreciate this information. It’s been a great year for me and you’ve inspired me to increase my tsp contributions significantly when I know plenty of my colleagues haven’t made the effort yet. Keep it up, it’s much appreciated and the insight is invaluable.

  6. Just found your blog. The information is presented in such a way that even a caveman can benefit from your work. It is obviously a labor of love for you, and I am grateful that you share your knowledge with those of us that need a little coaching. I will be sure to share, and I hope your blog reaches thousands. Thanks!

  7. Been using a S&P 500 moving 200/40 average to determine when to get in and out of equities (c/s/i). Has worked well, but I do tend to get out later than I’d like as well as going back into stocks late missing some early gains.

    Thanks for creating this site. It really opened my eyes to a more intelligent way of TSP trading.


  8. Congrats on your 38.35% return!!!! I moved a lot of funds back and forth before following your Twitter feed…. but since then, I kept all my funds in S fund and the rewards are great. Thank you!

  9. Very helpful. Especially for new government employees just getting started with retirement. I’ve emailed your link to multiple coworkers. Keep up the good work.

  10. I look forward to your updates every month and have gained a great deal of knowledge from them, not to mention awesome returns. thank you for sharing.

  11. Bro,
    “Here are the final returns for the month of April. The S-fund is clearly lagging and is clinging to a positive return for the year.” (0.17% up for the year, down -2.47%)

    Wouldn’t ya know, just as I implemented your strategy. “Hang on in there, Baby…”

    Take care

  12. Just wanted to express a moment of gratitude for your time. This is a great site and I very much enjoy your suggestions and insight. While I may not impulsively react to your updates financially, I don’t think you had ever intended on that to be the case. I use your site as a main source of information and I can not thank you enough for offering the information you do. From your generosity, I am always better equipped to make a more informed decision on ALL of my investing, but particularly my TSP. Please keep it going, thanks again!

  13. Stumbling upon this blog is like finding an oasis in the desert. I have intuitively followed your approach since the 90s, and it has rewarded me immensely, though, like Ron (above), I have, during the last downturn in the stock market, gotten out and gotten back in a little later than optimum. I am almost 4 years retired, so I no longer can make new contributions, and, because I draw a healthy CSRS pension and have had other strong investments, I will not draw on TSP until it’s mandatory, and that is over 7 years away. Unlike my peers who all have 100% of their allocation now in the G fund, regardless of their financial circumstances, I currently am fully invested in the S Fund, but keep an eye on the markets daily. Because I have just discovered your site, I have not had time to explore this yet, but I’m hoping you have some advice for those of us who continue to manage our investments in the TSP in retirement and are constantly confronting nay-Sayers who think we should be playing only the most risk-free game possible.

  14. I learned a long time ago it’s far easier to preserve existing capital in the TSP fund than it is to rely on the myth of dollar cost averaging, which robs you of the power of compounded returns from your fully valued portfolio. There is absolutely no reason to throw away hard earned equity when funds are losing money. Place your money in the G fund and wait it out, at zero cost. If you are still in the S fund you just don’t get it. There is no reason not to preserve capital and keep it working for you during a bear market, then get back in on the upswing. Remember: preserve capital at all costs, get a return during a downswing, buy low and watch it grow, go to the G fund when the bear comes back. This is the simple beauty of the TSP funds; moving money around at no cost.

  15. Hello. I am new to the federal government and am many years away from retirement. I have read a lot of your writing and it is a great help to someone who is new to this to have a lot of information to read. I was wondering if you have any specific resources for anyone who is at the very beginning of a hopefully 30+ year career with TSP. Thanks in advance for any help you can provide!

    1. David,
      Welcome to the federal government! I’ve been working for the VA for 3 years after serving 20 yrs in the A.F. If there is one thing I wish I would have done at the beginning of my A.F career, it would have been to invest as much as I could as soon as I could in theTSP. I got started late (at age 40) so I have I have to invest more than someone who got started investing in their 20’s or 30’s. The books that got me interested in investing were: “The automatic Millionaire” and “the Millionaire next door”. Good luck!


  16. I’m 48 and eligible to retire in 2024 although realistically probably won’t be able to afford to do that. I’m naive when it comes to retirement planning and the market, but right now I’m 100% in the TSP S fund. Was just reading about the Roth option and wondering if I need to keep my 5% in the TSP S and also allocate a percentage to Roth as well. What are your thoughts?

    1. I don’t believe tax rates are likely to be higher overall when I start withdrawing from my TSP in another 15 years or so. And I don’t believe that my various sources of income at that stage will be enough to push me into a higher tax bracket (and I might well fall to a lower bracket), so I have elected to stay with the traditional TSP. If you haven’t seen it yet, I have a whole post here on the Traditional vs Roth TSP subject.

  17. As for the Roth TSP option, I find that the advantage of having all your gains on Roth contributions becoming tax free upon withdrawal well outweighs the disadvantage of paying tax on the contributions now and also having to wait until 59 1/2 to withdraw. Just my opinion…

  18. Hi TS Paul…
    Just a quick note of gratitude…PIP is at 11% for past year using the information I learned from reading the Guide…would be more if I could develop a higher risk tolerance, but I’m happy and still RETIRED!!! You are truly a gift. Thanks again…
    Ron C.

  19. I just wanted to quickly say that I really appreciate you taking the time to run this website. I have read through every post, and really look forward to each update. I have also shared it with my federal co-workers.

    I was always an above average investor, but this website and your analysis have helped me to become even more effective due to a better understanding of the business cycle investing strategy. It has helped me with both my Thrift Savings Plan and other investments.

    Again, thank you. Your work here is appreciated by many.

    1. I suppose you could try to adopt it to the Thrift Savings Plan funds, but why? The purpose of that strategy is not to maximize returns, but to minimize risks. It is structured specifically so that it has counterbalanced investments, when one does well, the opposite will do poorly. Its annualized return over the past five years has been 11.8% – that’s not special in a period with multiple years during which you could get 30% +.

    1. Thank You for a great Site! I used your Vanguard ETF guide awile to back to guide my Vanguard ETF purchases. I am wondering if you can comment on how you know when to switch ETF funds at Vanguard? and since there is no “G” fund at Vanguard, when the market takes a down turn what fund do you use to keep your money safe?

      Thank You,

      1. I largely switch at the same time as I change my Thrift Savings Plan allocation – based on where I think we are in the business cycle. To minimize tax implications in my non-Roth accounts, I will sometimes buy the funds indicated for the next phase of the business cycle, particularly if I think we are getting close. (For example, for the past year or two, I have been buying S&P 500 funds instead of small cap funds as I think we are in that grey area between phases and that way I won’t create a taxable event by switching funds.)

      2. I make changes in my non-TSP investments at about the same time I make allocation changes within the Thrift Savings Plan, although I will often buy one phase ahead if I think we are close to switching phases in my non-tax advantaged accounts (so for example I would buy large caps now rather that small caps to avoid a taxable transaction if I then felt the need to switch to large caps a few months down the line)

        With respect to bond funds, I would typically use a fairly diversified Vanguard bond fund which is roughly equivalent to the TSP F Fund, under the theory that the fed will cut interest rates in an effort to stimulate the economy, which will cause existing bonds to be more valuable. So if I was buying an ETF: BND, and if a mutual fund: UBMFX. The G Fund is usually sort of a last resort safe haven in my mind as an environment of falling stocks and rising interest rates over the medium or long term is almost never seen, so typically in recession the F Fund would be a better choice.

  20. I’m planning to change my assets and allocation to 50-50 in S and C funds as soon as the Dow hits 18K again. I have all in S right now (with 15% future contributions going to I). Any suggestions, comments, problems with that plan? Thanks

    1. That sounds like a perfectly reasonable Thrift Savings Plan allocation and one I would be comfortable with right now. I am curious as to why you would base that on the Dow hitting a particular benchmark. FWIW, I use the S&P 500 as my market benchmark because I think it gives a broader picture of the market whereas the Dow can be disproportionately shaped by a particular sector (energy these days) or even a large stock or two.

  21. Thanks for the response. The Dow was around 18K before the correction. I am just waiting for the rebound before I move money. If I did it at the low end of the correction, would I not be solidifying the loss? Thanks for the heads up on the S&P 500. I watch the Dow primarily out of habit.

  22. Made the change to match the February Allocation on 1 February. Today, with the 3 day up streak in the markets, have erased any losses in February. I plan to make the allocation change for March o/a 1 March. Now only down 4% for the year. Finally, some good news with TSP. Thanks for the blog, I can, finally, manage my account with some understanding of how it all works.

  23. I’ve just separated from the Army with $10000 in the G fund. I’m will be attending medical school for next four years. What’s your take on what I should do with my fund? Should I leave it in the G fund or change it to your recommended C: 85% I: 15%? Or should I just cash it for my living expense? Thanks for your input.

    1. As always; I can’t give individual advice. But under my strategy I would never consider G Fund unless we were entering a recession, and I subscribe to the idea that you can borrow for anything in life except retirement. Which would leave me with your option #2 or something close to it.

      Thank you for your service and good luck at med school.

  24. Warning: mysqli_num_fields() expects parameter 1 to be mysqli_result, boolean given in /home/tspalloc/public_html/wp-includes/wp-db.php on line 3283
    class="comment byuser comment-author-gillslikafish odd alt thread-odd thread-alt depth-1">

    Hi TS Paul,
    Firstly, thank you for your time and all the valuable information provided on this blog. I feel grateful to have found your site.

    I have been in federal service for almost 10 years, with most of that time spent solely in the G fund. About a year ago, I moved my allocations to the L2040 and L2050 funds as I am quite far from retiring. I would like to move all my current allocations in to the C fund as you have, but I am confused if I should do this given the current high price of stocks you mention in your analysis? Will I be losing money by making this interfund transfer at this time?

    Thank you so much,

  25. Thank you so much for this information!

    Someone was recently suggesting a diversification in tax-deferred versus tax free so that the amount one has to count as taxable income at withdrawal is lower. Do you already have a post addressing this? Thanks in advance!

    1. Nope, there is an April/May update out there too. But my allocation hasn’t changed since the beginning of the year so the bottom line is the same.

  26. Any comment on the warnings from the Fed in the most recent financial stability report? Is this something we should be worried about?
    Btw, this site is amazing.

  27. No pressure at all , but just curious but will you be doing a New Year blog post and outlook? I always enjoy your postings, thanks.

  28. Like many, I have bookmarked and shared your site with everyone I know. This used to be the most credible and informative site I knew pertaining to this topic and everyone here has so much passion for your work. With such a good following and developed base (not to mention all the talks and promises of growth you had stated last year), it would be nice for you to get back to a portion of what you were doing and promising last year. There is so so much going on that we would love to hear insight about, and like many, have relied over the years on hearing your input on said topics.

    1. Would you consider (or anyone) relaying another reliable source to look up advice on TSP/market trends until you decide to get back into the game?

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