The Investment Options in a Thrift Savings Plan (TSP), Ep #113

<p>I’ve spoken with multiple women making the same mistake with their TSP plans (a Thrift Savings Plan (TSP) is the government’s version of a 401k). Why? Because people are scared about the economy and inflation. People make their decisions based on emotion in times of uncertainty. So in this episode of the Retirement Made Easy Podcast, I’ll share what this mistake is and why I think it’s a mistake. I’ll let you decide what to do with the information. Don’t miss it! </p> <p> <<<<<<<<<<<<<<<PLAYER CODE GOES HERE>>>>>>>>>>>>>>>></p> <h2>You will want to hear this episode if you are interested in...</h2> <ul> <li>[1:57] History doesn't repeat itself—but it often rhymes</li> <li>[4:35] Check out RetirementMadeEasyPodcast.com!</li> <li>[5:49] The dangers of a fixed pension without a COLA</li> <li>[9:03] Dissecting the Government Securities Fund</li> <li>[15:23] Walking through the different pension options</li> <li>[19:18] Retirement planning is about making smart choices</li> </ul> <h2>The dangers of a fixed pension without a cost-of-living adjustment</h2> <p>One of the top three risks to everyone’s retirement is the rising cost of living. The cost of living rises on average by 2.9% per year (calculated over the last 30 years). If you lived on $50,000 30 years ago, you’re being squeezed today. A fixed pension without a cost of living adjustment is like working at a job for 30 years and never getting a raise. </p> <p>If you have a fixed income in a world where costs rise every year, your purchasing power declines every year. Sadly, most corporate and private pensions do not have cost of living adjustments. But the beauty of government pensions is that there is a cost of living adjustment associated with them.</p> <h2>Investment options in a TSP</h2> <p>I spoke with three women that are going to retire with a government pension (TSP plan). They’re concerned about the economy and their TSP shrinking. So all three had their money invested in the Government Securities Fund (a mutual fund within the TSP plan, abbreviated a