TSP Planning Report – February 2020

How to allocate your TSP

Facts:

    • Unemployment came in at 3.6%.
    • 4th Quarter GDP was 2.1%, according to the 1st estimate.
    • PMI expanded, with the index reading to 50.9%.
    • The S&P 500 (C Fund) decreased  .04% during the month of January.

Assessment:

    • PMI has returned to expansion territory – that’s a good sign.
    • 2.1% quarterly GDP is just okay – nothing to get excited about, but also not terrible.  It’s been at this level for about half a year.
    • Unemployment remains at a 50-year historic low.
    • The S&P 500 performance is a minor blip.  Especially on the heels of a 31.45% in 2019.

Bottom Line:

This is good data.  Not even Coronavirus is scary enough to thwart this economic optimism. My biggest concern – this is an election year.  The media may present a decline of the American economy into socialism.  Even if that doesn’t happen, the mere hype may make for a wild ride.  I expect this will have its most notable impact starting in August, but it may even be as soon as Super-Tuesday in March. I would suggest anyone who will be deriving income from their portfolio over the remainder of this year to proceed with caution. If you are on the brink of retirement, consult with me before you position your TSP too aggressively. Email me stephen@stephenzelcer.com Check out the 2 page report below. DON’T JUST LOOK AT RATE OF RETURN. Always view the target return of each portfolio in context of its ranges of fluctuation. To download this month’s portfolios – Download Report
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