Do you like the simpilicty and low cost of index funds? But want some personalized advice to structure your portfolio.
Q.I saw your advice to a Seattle reader who had lost some money in the government Thrift Savings Plan. I also have over $100,000 in the TSP. I have been investing conservatively for the last few months because the stock market has been declining. I’m retired and 68. Soon I will have to take a monthly distribution. What allocation of the five TSP funds would you suggest so that my TSP gains rather than loses ground, especially at this time of my life?
Is it better to hold on to the TSP till I’m ready to take a monthly distribution? Or should I roll over the account to a private company for later distribution? I’m not sure which way to go. Which would be less costly? ---H.A., by email from Franklin, MA
Q. I would like to know the difference between a variable annuity and a life annuity. A few years ago I invested $100,000 in a tax-deferred variable annuity. Later, I came to know there is a surrender charge for 7 years. Is a life annuity tax-deferred? Is there a surrender charge? ---V.B., by email
A. Many people get confused when talking about annuities because the same word applies to many insurance products that are very different from one another. Here is a list of the basic types of annuities.
CD-equivalent annuities. The most basic type of annuity is the functional equivalent of a CD issued by an insurance company. You make a commitment for a fixed period of time and receive a stated amount of interest, tax-deferred
Q. A co-worker is 65. He is going to start taking Social Security even though he is still working full-time as an engineer, making good money. I am close to being the same, but one year older. I am wondering if I should do the same thing.
His rationale for taking Social Security now is that he can invest it and get a return that is better than the 8 percent a year that Social Security benefits grow. His financial adviser told him he can get him12 percent to 20 percent, even in today’s market, with stocks and funds that return good dividends. Does this ring true? ---H.T., by email from Plano, TX
A. Let me put this gently. Your friend is being led astray by his self-serving adviser.
