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Posted on 4/27/10 at 9:13 am to ZugZug
quote:
What's everyone's opinions on the TSP given to gov't employees? How do you think they compare to a typical 401k?
I've not spent an extremely long time looking at the TSP, but from what I've seen, I think it's a pretty nice plan. Unfortunately, a participant has no "micro" control on what stocks they can pick. However, their "L" funds, which are just a composite of their other index funds, seem to be well thought out.
Also, their management fees are extremely low: 0.028%.
Any caveats or hidden things to look out for with the TSP?
I would strongly recommend you look for this info on federalsoup.com
Posted on 4/27/10 at 9:30 am to TheHiddenFlask
quote:
Dave Ramsey is good if you are
1) Low income
I'm not real sure what makes you think this. After hearing all of the suggestions he makes I'm not sure why it would only apply to someone with a low income.
quote:
2) Terrible at budgeting
I agree with this but I'm willing to bet that the percentage of households that sit down monthly and do a budget is less that 10%. If he motivates people to start doing that then whats the problem.
quote:
3) Completely ignorant about finance
Again, you are talking about 90% of the population. I think the people who post on the money board assume that the general population is much more knowledgeable about finance than they actually are. Dave presents common sense finance advice and gives it in a way that people that dont have finance degrees can understand.
quote:
4) Not actually looking for the best practices, but rather the most psychologically effective practices.
I'm sure you are probably referring to his advice on debt payment. Smallest balance to largest. I've heard Dave say that paying off the highest interest rate balance is the best way if you are only focused on the bottom line, but he has realized over the years that it is easier to keep people motivated if they have frequent successes along the way. Its a psychological ploy, but its effective, and that what matters.
quote:
His seminars are helpful for some, but hardly appropriate for the majority.
Couldn't disagree more. I believe that the vast majority of people would find at least something that Dave teaches to be helpful and informative.
Posted on 4/27/10 at 10:02 am to Haughton99
quote:
I'm not real sure what makes you think this. After hearing all of the suggestions he makes I'm not sure why it would only apply to someone with a low income.
Because he tells you things like "never go out to eat for dinner". His personal suggestions are infuriatingly frugal. Also, his methods are far too conservative for high income individuals. They may work, but people making a good bit of money would be much better off seeking help from a financial professional.
quote:
I agree with this but I'm willing to bet that the percentage of households that sit down monthly and do a budget is less that 10%. If he motivates people to start doing that then whats the problem.
Just because you don't have a spreadsheet of your budget doesn't mean you don't actually have a budget. Many people have an idea of what they are capable of doing in a month and just keep it in their head. This can be a perfectly effective method.
quote:
Again, you are talking about 90% of the population. I think the people who post on the money board assume that the general population is much more knowledgeable about finance than they actually are.
You are probably right, but there is a difference in ignorant and completely ignorant. There are a lot of people who don't no diddly about stocks and bonds, but still understand, in some functional form, how finance works.
quote:
Dave presents common sense finance advice and gives it in a way that people that dont have finance degrees can understand.
His methods are not common sense, which is my problem with them. His methods are psychological ploys that get people to stop doing dumb stuff. Not necessarily bad, but not really effective unless the people are doing dumb things to begin with.
I'm really done arguing this point. We'll just have to agree to disagree, but at the end of the day, Ramsey's core message is "spend less, save more", hardly worth the price of a book.
Posted on 4/27/10 at 10:03 am to TheHiddenFlask
quote:"Better than I deserve."
Because he tells you things like
Posted on 4/27/10 at 10:06 am to LSURussian
quote:
"Better than I deserve."
His call in show is infuriating. Hey Dave, my 85 year old mother is on a $6,000 a year fixed income and she has $30,000 in credit card debt.....
Plus, he rubs me the wrong way.
Posted on 4/27/10 at 10:07 am to John Merlyn
quote:
Hey Dave, my 85 year old mother is on a $6,000 a year fixed income and she has $30,000 in credit card debt.....
"She needs to get a job." - Dave Ramsey
Posted on 4/27/10 at 10:11 am to LSURussian
Thank god you guys finally came to help me out.
Do you know how hard it is to argue that "save more, spend less" is a dumb plan?
Do you know how hard it is to argue that "save more, spend less" is a dumb plan?
Posted on 4/27/10 at 10:22 am to TheHiddenFlask
I've tried to explain this for years to people, and you're absolutely right. It's frustrating. I can't listen to Ramsey anymore. But, what I've come to realize is that the vast majority of people that are following him and taking his advice, need it. They need direction. They need somebody to give them a plan of action, and they want it to be simple and given to them in laymens's terms. He does that. If you're understanding of finance is so simple that you actually need somebody to repeatedly tell you to that sitting on your hands 29 out of 30 days, paying off high interest debt is always the best option, and buying his book is going to make you a more financially stable individual then I can't help you anyways. Because his plan will absolutely do this for you, but it is by no means meant for everybody.
Posted on 4/27/10 at 10:31 am to TheHiddenFlask
quote:
Simply put, open a brokerage account and buy MVIS. If you can do it as part of a Roth.
You must not have been on here much when the shale property owners were propping CHK as an easy run to $100/share, much worse than the MVIS which is tongue-in-cheek for the most part. Still funny as shite, though.
Posted on 4/27/10 at 10:45 am to TheHiddenFlask
quote:
Do you know how hard it is to argue that "save more, spend less" is a dumb plan?
To reduce Dave's message down to this is simply ignorant. Financial Peace is a 13 week course. If every one of the 13 weeks was only about "save more, spend less" then I would have become really bored after about week 3. Its simply not. I don't really expect you to understand this though because you stated earlier that your only exposure to him was through is radio show.
Posted on 4/27/10 at 11:05 am to tirebiter
quote:
You must not have been on here much when the shale property owners were propping CHK as an easy run to $100/share, much worse than the MVIS which is tongue-in-cheek for the most part. Still funny as shite, though.
Yeah, honestly I don't think that it's a really bad stock, it's just become kind of a MT legend. Zilla is a good guy with a good sense of humor, so I don't mind joking about it.
Full disclosure: I bought MVIS in my student portfolio and it has done pretty well for me.
Posted on 4/27/10 at 11:58 am to TheHiddenFlask
At the end of the day Zilla might be right about MVIS. I appreciate the humor directed at MVIS as well----and don't own any.
Posted on 4/27/10 at 1:03 pm to lynxcat
quote:
Ramsey says to pay down the smallest balance, correct?
I believe so. It's a psychological ploy, the idea being that most people get the feeling of reward once they've paid off the entire balance, not merely by making one payment.
To his credit, Ramsey is quite open about the fact that the basis for this is psychological, not financial. He's trying to get people who don't really understand the subject to at least do something that's somewhat effective if not completely optimal.
Posted on 4/27/10 at 1:41 pm to foshizzle
We need to ban Dave Ramsey references, people get all twisted about it. Full Disclosure: I own 11 shares of MVIS.
Posted on 4/27/10 at 1:42 pm to kfizzle85
quote:
I own 11 shares of MVIS.
Risking your entire fortune, I see.
Posted on 4/27/10 at 1:43 pm to foshizzle
Don't hate brah. I swing for the fences.
Posted on 4/27/10 at 1:45 pm to foshizzle
quote:
Risking your entire fortune, I see.
He's talking about the super secret class A shares that only cool frat brahs can buy.
ETA: They are comparable in price range to BERK.A shares.
This post was edited on 4/27/10 at 1:46 pm
Posted on 4/27/10 at 1:51 pm to TheHiddenFlask
Well damn, the secrets out now. Of course, since Rivers told us all of those financial luminaries read this board, we're definitely not pumping that highly illiquid class of stock either. Nope, not at all...
Posted on 4/27/10 at 10:09 pm to kfizzle85
Well this thread sure went off on a tangent...
To the original poster(if you're still reading this thread), I'm in the same boat as you. I'm 25 and a Gubment employee. You're best bet is to put at least 5% in to your TSP. Spread that in some variation across the CSI funds(i.e.- 35% C, 35% S, 30% I). I'm around 40% in the C and S and 20% in the I. We're both young so we can afford to be more aggressive with investments. Of course, if you don't feel like dealing with any of that just go with a lifecycle fund for your target retirement. They perform fairly well and are a pretty good investment vehicle from the numbers I have seen.
After that if you can look in to a Roth IRA. I'm maxing out my contributions at $5K and I would suggest you do that as well...if you have the ability to do so. Then follow the advice that many have already mentioned on here. Invest that money in to Mutual funds, Index funds, etc.
This isn't the end all be all of retirements, but this will get you heading in the right direction.
To the original poster(if you're still reading this thread), I'm in the same boat as you. I'm 25 and a Gubment employee. You're best bet is to put at least 5% in to your TSP. Spread that in some variation across the CSI funds(i.e.- 35% C, 35% S, 30% I). I'm around 40% in the C and S and 20% in the I. We're both young so we can afford to be more aggressive with investments. Of course, if you don't feel like dealing with any of that just go with a lifecycle fund for your target retirement. They perform fairly well and are a pretty good investment vehicle from the numbers I have seen.
After that if you can look in to a Roth IRA. I'm maxing out my contributions at $5K and I would suggest you do that as well...if you have the ability to do so. Then follow the advice that many have already mentioned on here. Invest that money in to Mutual funds, Index funds, etc.
This isn't the end all be all of retirements, but this will get you heading in the right direction.
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