More feds join Million $$$$ Club

Thanks to the surging stock market and slow-but-steady investing , Uncle Sam now has 9,599 bona fide millionaires on the payroll. And that doesn’t count President-elect Donald Trump or his new Cabinet choices.

In January 2016, 3,272 civil servants had Thrift Saving Plan accounts worth $1 million or more. Now there are almost 10,000 and counting. And a growing number of members of Club Mill weren’t rich when they joined Uncle Sam. They hit the $1 million mark the old-fashioned way: by investing as soon as they joined government, by investing the maximum amount allowed, taking advantage of Uncle Sam’s generous 5 percent match and sticking with stock investments (the C, S and I funds) during the Great Recession. When the markets were down, they continued to buy (at “sale” prices). And when it started rising to its current record level, those stocks they bought at bargain prices enriched their paper net worth dramatically.

Compared to January of last year, the number of TSP participants with account balances of $50,000 or less is roughly the same, about 2.8 million people. But the average number of years they’ve been investing went down, from 9.3 years to 8.8 years.

Over the past 12 months, the number of feds with balances between $50,000 and $249,000 rose slightly to almost 1.5 million.

Investors with account balances of $250,000 to $449,000 jumped from 371,209 last year to 413,491 this year.

The number of people with TSP accounts worth $500,000 to $749,000 went from 92,092 to 120,124 this year.

Civil servants with accounts worth between $750,000 and $999,000 nearly doubled from 18,800 to 35,161.

And last but not least, the number of TSP millionaires — which includes both active duty and retired federal workers — went from 3,272 last year to 9,599 as of the most recent tally.

In the early days of the TSP, the only Club Mill members were political appointees (often high-priced lawyers who were appointed federal judges) or sub-Cabinet heads. They liked the low-administrative fees of the TSP and its investment options. And, if they qualified, the 5 percent match by their agencies. But thanks to time and steady investing, the majority of millionaires today did it the hard way. They invested in the stock funds — through good times and bad — and their accounts prospered.

This time last year we quoted an expert on the TSP who said, “The best way to save for retirement is to have a plan (or use the TSP’s self-adjusting Lifecycle, or L , funds and stick with it. Reacting to moves of the market never works out — you wind up selling low, when the market is down, and buying high when you return with it is going strong.” He said, “It’s hard not to panic… because the media pounds the stock market results hard, 24/7 and it’s hard to tune out.”

Best bet: Do what most members of the TSP millionaire’s club did: Have a plan and tune out!

Nearly Useless Factoid

By Michael O’Connell

The origin of pink lemonade is up for debate. One story says a concession stand operator at a circus in 1857 ran out of water and borrowed a vat of water one of the show’s bareback riders used to rinse out her pink tights. The resulting “fine strawberry lemonade” was pink in color and sold well. Another story says that a circus promoter in the 1870s accidentally dropped red cinnamon candies into the lemonade he was mixing, causing the liquid to turn pink.

Source: Huffington Post

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