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TSP

Administered by the Federal Retirement Thrift Investment Board, this defined contribution plan for federal employees has roughly 4,614,874 participants, and over $358 billion in assets under management. Ask your TSP questions and post related topics here.

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jjg53  
#1 Posted : Monday, April 19, 2021 4:35:07 PM(UTC)
jjg53

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Looking to pay off a residential loan I took out 4 years ago. The problem is... My TSP is up 65% in my 12 month performance. I only do C S and I fund. My question is, should I pay back the loan now or wait til it falls again? It would be a significant gain I shares for what I want to pay back... Thanks!
roger.d  
#2 Posted : Tuesday, April 20, 2021 9:53:21 AM(UTC)
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Originally Posted by: jjg53 Go to Quoted Post
Looking to pay off a residential loan I took out 4 years ago. The problem is... My TSP is up 65% in my 12 month performance. I only do C S and I fund. My question is, should I pay back the loan now or wait til it falls again? It would be a significant gain I shares for what I want to pay back... Thanks!


I don't understand the question.

Do you have a loan with a bank or a loan against your TSP?

If the loan is against the TSP, you could pay it back and put that amount into the G fund. Move it to the others when you feel it is appropriate.
Socialist governments traditionally do make a financial mess. They always run out of other people’s money. --Margaret Thatcher
FatHappyCat  
#3 Posted : Tuesday, April 20, 2021 11:25:58 AM(UTC)
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Originally Posted by: jjg53 Go to Quoted Post
Looking to pay off a residential loan I took out 4 years ago. The problem is... My TSP is up 65% in my 12 month performance. I only do C S and I fund. My question is, should I pay back the loan now or wait til it falls again? It would be a significant gain I shares for what I want to pay back... Thanks!


You're asking the wrong question. It doesn't matter if the stock is up 65%, down 65%, or flat; you're putting in the same amount of money that you took out. The amount of shares you own may be different but your value would be exactly the same.

The only question that should matter to you is whether you are ok with 'losing' access to the amount of money you would have on hand if you didn't pay off the TSP loan right away.
jjg53  
#4 Posted : Tuesday, April 20, 2021 12:24:03 PM(UTC)
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Fathappycat, thanks. That's what I was inquiring about. But yes it was a residential loan I took out in 17' and want to pay it off. I was assuming that since shares are up right now in the C S and I fund so high, I should wait til they are lower and would have more shares at a lower rate. Either way, just going to pay it off regardless, as I was younger then and will never again touch tsp for loans. Appreciate the feedback from everyone!
roger.d  
#5 Posted : Tuesday, April 20, 2021 1:00:28 PM(UTC)
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Originally Posted by: jjg53 Go to Quoted Post
Fathappycat, thanks. That's what I was inquiring about. But yes it was a residential loan I took out in 17' and want to pay it off. I was assuming that since shares are up right now in the C S and I fund so high, I should wait til they are lower and would have more shares at a lower rate. Either way, just going to pay it off regardless, as I was younger then and will never again touch tsp for loans. Appreciate the feedback from everyone!



From the TSP's website: https://www.tsp.gov/fund...nce/share-price-history/

In January 2017, the C fund was in the $31 range, up to $38 on Dec 29

Feb 19, 2020 it topped at $49.6572

Mar 23, 2020 it bottomed at $32.8598

Apr 19, 2021 it is at $62.2421


I hope you don't have the opportunity to buy back in at the price you sold at in 2017.

Socialist governments traditionally do make a financial mess. They always run out of other people’s money. --Margaret Thatcher
jjg53  
#6 Posted : Tuesday, April 20, 2021 1:03:43 PM(UTC)
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Roger that's my thoughts. Wait til it goes down then pay it back. I will be mobilized soon so I won't be contributing to my civilian tsp (where I took the loan) so I could just wait a half a year then pay it back
roger.d  
#7 Posted : Tuesday, April 20, 2021 2:29:53 PM(UTC)
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I hope we don't see another 30% drop in the market. That would take the C fund to around $40.

If you feel the market is going to have a correction, you can still pay off the loan. Transfer the money into the G fund and wait.

I feel there will be a correction. I don't know when or how big. Hopefully less than 20%.
Socialist governments traditionally do make a financial mess. They always run out of other people’s money. --Margaret Thatcher
FatHappyCat  
#8 Posted : Tuesday, April 20, 2021 7:17:31 PM(UTC)
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Originally Posted by: jjg53 Go to Quoted Post
Fathappycat, thanks. That's what I was inquiring about. But yes it was a residential loan I took out in 17' and want to pay it off. I was assuming that since shares are up right now in the C S and I fund so high, I should wait til they are lower and would have more shares at a lower rate. Either way, just going to pay it off regardless, as I was younger then and will never again touch tsp for loans. Appreciate the feedback from everyone!


You're asking the million dollar question and everyone has their two cents on the matter. Realistically, it doesn't matter what anybody says because the only way you're going to get a 'good' answer to your question is if someone has a working crystal ball or a flux capacitor.

Logically speaking though, if you don't need the money, there's no good reason to have the loan outstanding. Even parking money in the G fund would be better than paying any sort of interest.
jjg53  
#9 Posted : Wednesday, April 21, 2021 2:09:19 AM(UTC)
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Ya I just decided to write the hefty check and send it off. It cannot be a bad plan regardless to just have money sitting in savings and not doing anything in TSP!
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