Question: Just found your site and I am impressed. Your newsletter is recommending to be 100% in the G Fund (“Money Market”). Unfortunately, I am still invested in a mix of C, S, and I funds (the three stock funds). I want to shift to the G fund ASAP, but when my portfolio is seeing $5k to $10k swings daily for the past couple weeks, timing is crucial! What advice do you have?
Answer: I do not know how to time the market. You might wait for a small rally in stocks and then sell. Then again, that rally might never come. Or, by the time it does come, the amount of money you make on the rally might be less than what you would have made had you switched to the G Fund right away.
You are right though that stocks are very volatile. If you are worried about selling stocks at the worst possible time, then here is a strategy that I would suggest. Every day, transfer a fixed dollar amount from the stock funds into the G Fund. Do this over a relatively short period of time, such as 1 week or 2 weeks at the most. (TSP’s interfund transfer rule allows you to make unlimited transfers into the G Fund.) Also, since we are 100% in the G Fund right now, remember to set all future contributions to go to the G Fund.
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