My First Thrift Savings Plan Advice: Get Out Of G Fund Immediately!
When the Thrift Savings Plan first became an available option, I decided to invest. At that time, I did not know the first thing about investing. I relied on the Thrift Savings Plan advice of friends. They thought it was a good idea so I looked at it briefly and decided I would invest in it also. I knew that I cared about my future and wanted to save money. I saw this as a simple way to get started. My TSP investment strategy left a lot to be desired.
So, I began investing in the Thrift Savings Plan. I was excited…I was doing the right thing for my future. Oh, wait…I didn’t really know what I was doing. What TSP fund should I invest in?
So, what did I do?
I put all my money in the G Fund. There it would be safe and I would not have to worry about losing any of my hard earned money. I figured that would be the best way to invest in TSP and keep my money safe. And it was safe…just as safe as a savings account.
Wow! I’m gonna be a millionaire!
That’s what I thought.
Of course, that is not the way to achieve that goal. The G Fund is safe…there is barely any risk. But that means there is also barely any reward. I was young and naive at the time.
But guess what happened?
Luckily, a friend and I started talking about Thrift Savings Plan at work. And I boastfully proclaimed I am investing in the G Fund.
Duhhh! Wrong answer!
My friend quickly told me how other funds were performing much better and how the G-Fund was basically a non-performer. It was a safe play but not the best way to invest in TSP for your future.
You can compare the different funds using the funds comparison matrix. Then create the best TSP allocation for your investment goals.
After talking to my friend, I took a more serious and active approach to investing in TSP…and that has made all the difference.
Okay, that has not made ALL the difference. I just wanted to say that from the quote…
“Two roads diverged in a wood, and I—. I took the one less traveled by,. And that has made all the difference.” Robert Frost
If you look around this website, you can easily see that I do more than invest in TSP. Now, here is a bit more Thrift Savings Plan advice and resources that you may find helpful.
Books that may help with TSP and investing in general
The first advice I will give you is to learn about investing if you have not already done so. Don’t just rely on what others tell you. It’s your money and your responsibility. Make sure you learn how to take care of your money and make it grow. Below are a few books that can help you get started. I recommend you read those and continue to learn more and more.
Next, take the information you learn and apply it. Knowledge is useless without application. So, don’t let it go to waste. Apply what you learn. Then learn from the application of that knowledge. Try and fail…try and fail…try and succeed!
Last, some may say this advice is not as thorough and detailed as they would like. But I think education is the most important investment you can make. Take the time to read and learn. Then do your due diligence and make your investment decisions.
I hope you found this Thrift Savings Plan advice helpful for not just TSP, but other investments as well. You can invest in the G Fund if you really want to, but you can get better results from the other funds.