Military update: Military ‘thrift savers’ stung like most investors

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Military update: Military ‘thrift savers’ stung like most investors
By Tom Philpott
Mideast edition, Friday, October 17, 2008

With 36 percent of servicemembers participating in the government-run Thrift Savings Plan, and nearly 60 percent of their money tucked into stock index funds, military investors are seeing nest eggs shrink like those of other American investors.

For these servicemembers, and for 3 million federal civilian TSP participants, this is a time for “prudence not panic,” advises Gregory T. Long, executive director of the TSP program.

Long noted, during a phone interview, that most military TSP participants won’t reach an age when they must draw down their investment accounts for 20 to 40 years. Therefore, as tough as it is to watch the value of stock funds decline these days at an alarming pace, most military investors might want to perceive the drops as investment opportunities.

“The old adage of trying to buy low and sell high remains true,” Long said. “And in order to buy low you have to have stocks that are on sale. That does appear to be what’s going on right now,” Long said.

From Oct. 10, 2007, through Oct. 10 this year, the value of shares in TSP stock index funds fell more than 40 percent. The Common Stock Index or "C" Fund, which matches the performance of Standard & Poor’s index of 500 stocks, dropped 41 percent as did the Small Capitalization Stock Index Investment or "S" Fund. The International Stock Index or "I" Fund fell by 46.8 percent.


Rest of article at: http://www.stripes.com/article.asp?section=104&article=58194