In the mid-00's, Roy Weisert started to provide pro-bono "TSP TIPS" through email to his civil service coworkers. This list expanded in 2008 after returns of just over 4% while the S&P 500 was down over 38%. This continued until 2013 when one of our software developers, Justin Pearl, stopped by my office and said he'd like to discuss the TSP. I thought Justin, who was in his 30's, just wanted to ask if he was putting enough money away and where I'd recommend allocating it. Instead, Justin told me that he also owned a small software development firm named Investry, LLC and proposed that he develop an "app" and Weisert Investment Services, Inc. provide the allocation recommendations. As such, TSP TIPS was formed and on 13 September 2013 we provided our first recommendation to subscribers. Below is a link to the TSP TIPS website and some similar information to the "Services" tab.
Getting Started with TSP TIPS
THRIFT SAVINGS PLAN/GOVERNMENT 401K
A major aspect of any investment is to understand the risk and goals associated with that investment. The goals of TSP TIPS are the same as that noted on Weisert Investment Services, Inc. home page, that being to assist our clients in making "WISER" choices with their money by allowing them to substantially participate in Bull Markets and minimize or sidestep losses during Bear Markets. In order to accomplish this, we utilize a Trending Investment Portfolio Strategy (TIPS) as noted below. From a systemic perspective, the market will usually go through a bull and then bear cycle. Since it is extremely difficult (if not impossible) to get in at the very bottom of a market cycle, and then out at the top, we deliberately start to build an increasing allocation to funds as they move up in strength, and then reduce that allocation as it reverses course.
It should also be noted that while we are striving to minimize risk, there is market risk involved. And the amount of market risk you want to expose yourself to is dependent upon your personal risk tolerance. Some can accept more, others can’t, and no one shoe fits all. Since TSP TIPS is more focused on the equity portion (C/S/I funds) of the TSP funds, we recommend an “Asset Allocation” starting point. What that means is to take your age and then put that percentage of your TSP portfolio into the G and F funds. As an example, a 30 year old might put 30 percent into the G and F funds and then allocate “up to” the remaining 70 percent according to the TSP TIPS. Notice that I said “up to”. If you’re just starting out with TSP TIPS and not yet familiar with it, you may only want to invest half of that equity portion in TSP TIPS. Again, it has to be at a level that you personally are comfortable with.
Another point to consider when starting TSP TIPS is how to make that transition from your current allocation to that recommended by TSP TIPS. A worst case scenario would be to have all your funds in the G and F funds, jump into the market when we’re recommending a high allocation (above 75 percent) to the equity funds, only to see it start to turn downward. In this case where there is a delta between the equity allocations, we recommend that you stair step your way into the equity funds in 20 percent increments over a period of up to two months until transitioned over.