TOPICS
TOPICS
TSP rallies in December
All the funds in the Thrift Savings Plan finished December with solid gains, bringing hope to some investors who experienced significant losses in 2008.
The I Fund, which invests in international stocks, posted the highest gains -- 7.66 percent -- in December, among the 401(k)-style plan's five basic investment options. December's growth alleviated the fund's tough 12-month loss of 42.43 percent.
The S Fund, which invests in small- and mid-size companies by tracking the Dow Jones Wilshire 4500 Index, grew 4.68 percent last month. The fund's overall value is down 38.32 percent since December 2007.
Fixed-income bonds represented in the plan's F Fund earned 3.73 percent last month. The fund also posted the strongest gains for the year, at 5.45 percent.
The C Fund, composed of common stocks on the Standard & Poor's 500 Index of the largest domestic companies, rose 1.07 percent last month. But the fund experienced significant 12-month losses of 36.99 percent.
The TSP's most reliable investment option, the government securities (G) fund, posted minimal gains in December, rising 0.24 percent. The fund had a 12-month increase of 3.75 percent.
The TSP also has life-cycle options, a blend of the five basic funds that automatically grows more conservative as investors near retirement. Those designed for younger employees earned the most in December, because they invested more heavily in the I, C and S funds.
L 2040, intended for employees with a target retirement date around 2040, increased 3.63 percent; L 2030 rose 3.24 percent; L 2020 gained 2.82 percent; and L 2010 increased 1.66 percent. The L Income Fund, designed for employees with planned retirements in the very near future, gained 1.21 percent for December.
All the L funds lost value in 2008, however, with those designed for younger employees posting the steepest losses. L 2040 lost 31.53 percent; L 2030 fell 27.5 percent; L 2020 was down 22.77 percent; L 2010 dropped 10.53 percent, and L Income fell 5.09 percent.
COMMENTS
- any investment is a wise one. the mattress will no longer suffice. look to buffet and gates, carlos slim sulu? and the rest of the forbes list. this is the buy when fearful comes in. Brujo Posted January 31, 2009 6:58 PM
- It's painful to see so many people losing so much of their hard earned money. They've been told to buy stocks "for the long term" and not to think about their investment. The truth is that the risk and reward characteristics of investments change with time. Sometimes, stocks are a good investment, sometimes, they are not. At Peaceful Gains, we achieve consistently high long-term returns by picking the mix of TSP funds that maximizes the expected returns while not exceeding a fixed maximum risk. Alex Posted January 15, 2009 1:35 PM
- Glad I kept some money in the F Fund, even after a speaker at a retirement seminar said it should be called the "Forget it" Fund! That's why diversification should be your goal, so reverses in one fund don't wipe you out. ICEd Posted January 8, 2009 6:52 PM
