financial planner Stephen Zelcer

TSP Planning Report – February 2021

TSP Planning Report February 2021


  • This month’s unemployment rate lowered to 6.3% from last month’s 6.7%.
  • PMI (Purchasing Managers Index) continued to expand (any reading above a score of 50 means expansion). This month’s reading came in at 58.7, compared to last month’s 57.2.
  • The S&P 500 (C Fund) dropped 1.01% during the month of January.
  • The 1st estimate of Q4 GDP shows growth of 4.1%.
  • The Fed Funds interest rate remained at 0.25%, (and the Fed suggested that such rates will hold thru 2023) but the 10-yr treasure yield jumped from 0.93% to 1.34%.


Business continues moving along, as usual.  However, the uptick in interest rates will slow the rate of growth.  The market seems to be factoring this in at a rapid pace.  Anything housing related (think Zillow, Home Depot, etc) have already seen their stocks slide.  But, even non-housing small-cap companies are taking a hit.

All this is expected from rising interest rates, and, although it’s an uncomfortable ride, it does not signal the end of the world.  In fact, keep on buying as it goes down.  Eventually, it will stabilize and come back up.

I am still keeping an eye out on whether the government will interfere with the housing market (other than interest rates).  Will they impose rent control – which is tempting for government as they watch the price of Real Estate soar?   Will they prevent evictions, which will cause homeowners to forsake their properties and default on their loans?  It’s a wait-and-see game.  It should not stop you from investing.

Anyone who has more than 5 years before drawing income from their TSP should consider taking a more aggressive posture going forward and use my aggressive portfolio’s below.  If you are within 5 years of retirement, you should email me to get a more customized recommendation.

DON’T JUST LOOK AT RATE OF RETURN. Always view the target return of each portfolio in context of its ranges of fluctuation.

If you have any questions, feel free to contact me.

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Click here to download my portfolios

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