Interest Rates Rising???

Tagged: 

This topic contains 1 reply, has 2 voices, and was last updated by  TS Paul 3 years, 7 months ago.

Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
    Posts
  • #16968

    tommoran
    Participant

    Looks like interest rates are going up soon.

    My financial advisor for my non-TSP investments advises to drop bonds and be 100% in stocks now (based on my position and goals).

    Assuming this is true, how should I readjust my TSP? I am currently L2030 50%, C Fund 38% and S Fund 12% with a $300K and change balance.

    Any assistance on what to do in anticipation of interest rate increases would be greatly appreciated.

    #16977

    TS Paul
    Keymaster

    I agree that the TSP F Fund will do badly as rates rise.

    I can’t give individual advice, but would point out that the L2030 Fund is only 6% F Fund, so you have very little exposure to bonds in your portfolio as currently constituted.

    The L2030 has a lot more G Fund (29%) than I would want to have except in a last resort safe haven, but otherwise is not bad. (Note that people talk about the G Fund as if it was a bond fund, but it is not. With a real bond fund, your principal can decline, but with the TSP G Fund, your principal is completely safe.)

    A little more about the TSP L2030 here:

    https://www.tsp.gov/investmentfunds/lfundsheet/fundPerformance_L2030.shtml

    The TSP Allocation Guide www.TSPallocation.com

Viewing 2 posts - 1 through 2 (of 2 total)

You must be logged in to reply to this topic.