2017 ETF Timing Returns through 6/13/17; Basic Strategy +2.44%, Enhanced and Bull/Bear Strategies +3.63%

Reading Material

How much do you need to save for retirement?  A lot.  But a bit of good news for federal employees is that they also have a traditional pension component that will help.  Are you on track with these guidelines?  http://www.investopedia.com/articles/personal-finance/010616/whats-average-401k-balance-age.asp

A good summary of why you can’t just rely on buy and hold investing strategies over the coming decades:  https://realinvestmentadvice.com/retirees-may-have-a-spend-down-problem/

Article on the benefits of staying in the TSP when you retire, and an SEC bulletin discussing the importance of considering fees:  http://fedretire.net/the-tsp-advantage-should-i-stay-or-go/

https://www.sec.gov/investor/alerts/ib_fees_expenses.pdf

TSP Timing and ETF Timing have now beaten the S&P 500 for thirteen consecutive years.  Will it be able to match Bill Miller’s feat and beat the S&P 500 for fifteen consecutive years?  Time will tell.  https://www.bloomberg.com/news/articles/2016-08-11/bill-miller-buys-legg-mason-s-stake-in-his-fund-company-lmm

Are lunar effects on the stock market real?  Studies say yes, like this one from back in 2001:

“We find strong lunar cycle effects in stock returns. Specifically, returns in the 15 days around new moon dates are about double the returns in the 15 days around full moon dates.  This patter of returns is pervasive; we find it for all major U.S. stock indexes over the last 100 years and for nearly all major stock indexes of 24 other countries over the last 30 years….Taken as a whole, this evidence is consistent with popular beliefs that lunar cycles affect human behavior.”  http://nowandfutures.com/large/E2008-1-1629870.texte20lunarcycle.pdf

Here’s some data that shows the effect, which was particularly strong in 2015 but then reversed in 2016:  https://lunatictrader.wordpress.com/performance/

Another Study:  https://deepblue.lib.umich.edu/bitstream/handle/2027.42/36301/b2092645.0001.001.pdf

Per this article 86% of investment managers failed to beat benchmarks in 2014: http://money.cnn.com/2015/03/12/investing/investing-active-versus-passive-funds/ however the Enhanced strategy did so not only in 2014, but in 12 consecutive years, and never had a negative return.

According to this study http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1948627 , investment “literacy” declines about 1.65% per year after age 60, but financial confidence does not decline. Figure 3 from the above reference:

Decline of Financial Literacy with Age

Decline of Financial Literacy with Age

It is important entering retirement to have a simple plan to overcome this fact. Using a simple strategy such as those available at TSP Timing and ETF Timing will put your investing on autopilot. You can simply put all future fund transfer dates on a calendar, and then literally spend no more a few hours per year achieving superior returns that your friends won’t believe. Any cognitive decline in financial ability that you may face in the future will not matter.   You may want a financial adviser for other planning and estate issues, but you will not necessarily need one for investing your TSP or IRA or similar accounts.   In addition, the TSP/ETF Timing approach will be a snap for your spouse or anyone else to take over for you when the time comes. If I can do this, I’m confident that you can do this; you can easily and successfully manage your investments for life.

If you’re considering rolling over your TSP account to an IRA upon retirement, do your research first. The TSP Timing strategies show how you can generate higher returns by sticking with the TSP. Here’s a good article on the subject: http://www.bloomberg.com/news/articles/2014-08-12/brokers-lure-soldiers-out-of-low-fee-federal-retirement-plan

You’ve undoubtedly heard this advice before, but if the future returns of the TSP Timing strategies are even half as good as they’ve been since 2004, this is just plain wrong: http://money.federaltimes.com/2016/07/06/dont-fall-for-tsp-timing-advice/

Vanguard’s John Bogle proved his critics wrong.  Simply staying in the S&P 500 Index fund will give you better returns over time than most investing pros with actively managed funds can achieve. http://www.marketwatch.com/story/john-bogle-gets-the-last-laugh-2016-05-03 But it’s possible to do better.  If past returns are any indication, actively managing index funds using well thought-out strategies can blow away the returns of the simple buy-and-hold approach.

Here are some stats on how a balanced portfolio approach performed over a long period (1985-2015): http://ryandetrick.tumblr.com/post/136226077810/how-bad-has-2015-been-for-diversified-investors  Compare the numbers since 2004 (hint, it’s less than 6% per year) with the ETF/TSP Timing strategies.

Stock market returns over the next decade are likely to continue to be very meager.  https://realinvestmentadvice.com/why-the-next-decade-will-foil-financial-plans/  Therefore it’s important to have some means of performing better than the expected low single-digit returns. With ETF/TSP Timing you have a fighting chance of beating the averages.

Here is a great article about spending your savings in retirement. Don’t cut yourself short! http://investingforaliving.us/2016/04/09/retirement-spending-revisited-live-a-little-why-dont-you/

Top 5 reasons why the TSP is the best retirement plan ever:  http://www.fool.com/retirement/general/2015/01/25/tsp-5-reasons-why-its-the-best-retirement-plan-eve.aspx