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Old 01-31-2016, 07:45 PM
 
504 posts, read 652,767 times
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Quote:
Originally Posted by Nor'Eastah View Post
If ever IRAs and 401Ks were to be taken over by the gov't (a future possibility), this is where the money would go: gov't bonds. The gov't needs to sell its bonds, and the TSP and other retirement vehicles are the "buyer of last resort". And yes, it can happen.
I've seen on here this concern about gov't taking over IRAs and 401Ks a few times and am curious about where it is coming from?


If you believe that would you also be equally concerned the gov't could just as easily seize everything in your bank account and safe deposit box, come in to your house and grab the money out of your mattress?


Back on topic, the best things about TSP are the really low expense ratios and the simplicity of the thing. Because of the low fees, it's probably better than what a lot of people have access to through their employers. Although the simplicity means there are not as many things to choose from for more sophisticated investors.
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Old 01-31-2016, 08:29 PM
 
6,615 posts, read 3,742,110 times
Reputation: 13666
Quote:
Originally Posted by GeoffD View Post
I think most people are really lousy at managing their financial affairs. I think we should have a portable privately run defined benefit pension system. Unlike Social Security which is redistributive, this one would be 100% tied to what the employee contributes and matched by their employer. It's basically what union and public sector workers have always gotten.
Social Security's purpose is different. So that needs to stay the same.

The other programs, like 401k and such, address what you're talking about (saving, investing, employer maybe adding a little bit, with caps on everything, annual fees on top of fees).
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Old 02-01-2016, 06:43 AM
 
210 posts, read 150,713 times
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I guess I discount the G-fund benefit since it is becoming a major effort in Congress to get rid of it as it exists today. I see it going down sooner rather than later. As far as the low fees go. I don't think the fees will remain low after the contributors grow large enough to look like a profit source for private investment houses. I see the TSP losing it's special expense ratios more likely than the entire US workforce getting the single broker manager low current rates the TSP enjoys. If Medicare Advantage can exist so can TSP Advantage with plans left to "choice".
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Old 02-01-2016, 07:18 AM
 
Location: Central Massachusetts
4,800 posts, read 4,844,519 times
Reputation: 6377
Quote:
Originally Posted by AnnaLee2 View Post
I guess I discount the G-fund benefit since it is becoming a major effort in Congress to get rid of it as it exists today. I see it going down sooner rather than later. As far as the low fees go. I don't think the fees will remain low after the contributors grow large enough to look like a profit source for private investment houses. I see the TSP losing it's special expense ratios more likely than the entire US workforce getting the single broker manager low current rates the TSP enjoys. If Medicare Advantage can exist so can TSP Advantage with plans left to "choice".

I think you are mixing up a couple of things here. First I have not heard that the G fund is a target of Congress. The fees are commenserate with those of index funds that are bare bones and the manager just does the reinvestment based upon a small list of rules built into the fund's structure.

As far as private investment houses getting involved with TSP, I cannot see how they can possibly do that. It is as if we are granting them powers of the Federal Government (which by the way is another entity). Those that say that they are concerned that the Feds would raid the fund at a moment's notice have to understand what sort of act that would have to take. If they did that then who's to say that they can't just come knocking down your door and taking the money out of your mattress as one person here said.

We are all fearful that government is growing too big. That includes me. But I can't just sit and worry about what the consequences of that. I have a life to live. But I do what I can. I vote. I contact my congressman. I have talked to a few of my congressmen personally. I have expressed my views to them. I told them if they did things I felt were destructive to the country I would campaign against them. I have met with the Governor of my state. I have met presidential candidates in the past. I have stayed involved and I ask that you all do too. It is our duty. Not just a right. I have worn the uniform for the past 38 years protecting your right for that duty. Please exercise that.

I am off my soap box for the moment.
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Old 02-01-2016, 08:04 AM
 
Location: Great State of Texas
86,093 posts, read 72,479,637 times
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Quote:
Originally Posted by golfingduo View Post
I think you are mixing up a couple of things here. First I have not heard that the G fund is a target of Congress. The fees are commenserate with those of index funds that are bare bones and the manager just does the reinvestment based upon a small list of rules built into the fund's structure.

As far as private investment houses getting involved with TSP, I cannot see how they can possibly do that. It is as if we are granting them powers of the Federal Government (which by the way is another entity). Those that say that they are concerned that the Feds would raid the fund at a moment's notice have to understand what sort of act that would have to take. If they did that then who's to say that they can't just come knocking down your door and taking the money out of your mattress as one person here said.

We are all fearful that government is growing too big. That includes me. But I can't just sit and worry about what the consequences of that. I have a life to live. But I do what I can. I vote. I contact my congressman. I have talked to a few of my congressmen personally. I have expressed my views to them. I told them if they did things I felt were destructive to the country I would campaign against them. I have met with the Governor of my state. I have met presidential candidates in the past. I have stayed involved and I ask that you all do too. It is our duty. Not just a right. I have worn the uniform for the past 38 years protecting your right for that duty. Please exercise that.

I am off my soap box for the moment.
The Treasury has borrowed from TSP G Fund twice now to cover Federal deficits when we hit the debt ceiling.
This is part of their "extraordinary measures" to cover debt that Congress already authorized.
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Old 02-01-2016, 08:34 AM
 
Location: Central Massachusetts
4,800 posts, read 4,844,519 times
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Quote:
Originally Posted by HappyTexan View Post
The Treasury has borrowed from TSP G Fund twice now to cover Federal deficits when we hit the debt ceiling.
This is part of their "extraordinary measures" to cover debt that Congress already authorized.

Excuse me. The G fund is Treasury funds. They cannot borrow what they already have. I dont doubt what you say here. But what you are telling us is that the Treasury department went into the fund "G Fund" to borrow money. That I believe is not possible because the fund is made up of Treasury notes not cash.
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Old 02-01-2016, 08:41 AM
 
Location: Central Massachusetts
4,800 posts, read 4,844,519 times
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Going on to what you said HappyTexan is this quote from Fedsmith

Quote:
The Government Securities Investment Fund (G Fund) is one of these other government accounts used to fund the government on a short-term basis. There are assets of about $397 billion in the TSP. The G Fund holds approximately 37 percent of all TSP balances held by the 4.6 million TSP participants. As most readers know, the TSP is similar to a 401(k) retirement fund for about 4.6 million current and former government employees and uniformed service members. To make up for the deficit spending by the government, the Treasury has “suspended reinvestment” or taken assets out of the G Fund to pay for other expenses. - See more at: Borrowing from the G Fund (Again) to Offset the Debt Ceiling : FedSmith.com
Basically what they did was take the reinvestment funds that were supposed to buy new treasury notes and then returned them once the government was able to print new money.
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Old 02-01-2016, 08:53 AM
 
210 posts, read 150,713 times
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Quote:
Originally Posted by golfingduo View Post
I think you are mixing up a couple of things here. First I have not heard that the G fund is a target of Congress. The fees are commenserate with those of index funds that are bare bones and the manager just does the reinvestment based upon a small list of rules built into the fund's structure.
Cardin's counter to this may not hold if massive debt is created. There have been several discussion in Congress about G-fund changes.

It's called contracts. Right now one bidder for the TSP wins the contract. With a nationwide plan a lot of pressure to spread the wealth to more than one contract would be, in my opinion, a constant pressure point on Congress.


Quote:
Originally Posted by golfingduo View Post
Those that say that they are concerned that the Feds would raid the fund at a moment's notice have to understand what sort of act that would have to take. If they did that then who's to say that they can't just come knocking down your door and taking the money out of your mattress as one person here said.
Now, be honest, I didn't say that. I don't even believe it. I imagine some people just don't get what is going on when the G-fund is held back until the debt limit is raised and they invent Fed conspiracies.

Quote:
Originally Posted by golfingduo View Post
We are all fearful that government is growing too big. That includes me. But I can't just sit and worry about what the consequences of that.
I didn't say that either. Not me, I have nothing at all against government working on behalf of the citizens; I just don't know how to get to a government that has the sort of focus to do it. That isn't my issue.


I just wrote what I thought. Now you have a couple of links (click the blue areas above) from me. But I hardly said anything that should bring about such a strong response.
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Old 02-01-2016, 08:55 AM
 
Location: Great State of Texas
86,093 posts, read 72,479,637 times
Reputation: 27565
Quote:
Originally Posted by golfingduo View Post
Going on to what you said HappyTexan is this quote from Fedsmith



Basically what they did was take the reinvestment funds that were supposed to buy new treasury notes and then returned them once the government was able to print new money.
Well now isn't that "borrowing" ?
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Old 02-01-2016, 09:09 AM
 
Location: Central Massachusetts
4,800 posts, read 4,844,519 times
Reputation: 6377
Quote:
Originally Posted by HappyTexan View Post
Well now isn't that "borrowing" ?

In a sense but they could not and connot actually take funds from those acounts. Since they are actual treasury notes they actually already have the money. So back to that page here is another piece that explains it.

Quote:

When the “disinvestment” period ends, the securities are reconstructed as if the suspension had not occurred. In short, the G fund is used as an accounting gimmick to give the federal government more time to work out the problem with the debt ceiling. Presumably, the ceiling will again be raised by some amount before there is a government default. That makes some G fund investors uncomfortable. In the long run, it has not made any difference in the value of the investment.

Each time this occurs, readers ask why the federal government can use retirement funds to fund the government. Here is a quote from the Congressional Research Service:
“Congress has granted to the Secretary of the Treasury the authority to take certain actions that allow the Treasury temporarily to continue borrowing cash from the public without increasing the public debt. The Secretary is authorized to take these actions, which effectively reduce the obligations of the government that are counted toward the public debt ceiling, only during a “debt-issuance suspension period.”
When “extraordinary measures” are taken, here is what happens to some of your retirement funds:
“In these circumstances, the Secretary of the Treasury is authorized to:
  • suspend the investment of amounts in the Civil Service Retirement and Disability Fund that normally would be invested in interest-bearing Treasury securities;
  • sell or redeem Treasury securities held by the CSRDF prior to maturity; and
  • suspend the issuance of interest-bearing Treasury securities to the “G” fund of the Thrift Savings Plan.”
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