Why Haven’t You Put Your House Up For Sale Yet?

Federal employees may have seen their TSP balances drop recently, but the author offers advice on how to maintain a calm, long-term perspective.

Thankfully, the first quarter of 2020 is FINALLY over. The results are in and they’re not pretty.

If you’ve dared to open and take a peek at your Thrift Savings Plan statement you may be in for some shock. You might even see a decline in your account and think to yourself, “I didn’t know it was THAT bad.” You may even be questioning if this was worth it in the first place! 

As of 3/31/2020, YTD performance on the C Fund -19.65%, the S- Fund -28.14% and the I-Fund -22.70%. For some, those losses wiped out entire years’ worth of gains.

The suddenness of the loss was shocking as well. Almost all of that damage occurred in the span of a month, from February 19 to March 23rd. While April is off to a much better start, for some the damage has been done

Furthermore, COVID-19 is keeping us locked in our homes and creating even more stress! The financial toll from our TSP losses are secondary to our concerns about our health and the future. This snowball of stress can lead to emotional decision making. The single biggest mistake at times of high stress and volatility is the propensity to sell investments at or near the bottom, often years before actually needing the money that is supposed to be in a long-term investment.

In order to combat that rising tide of panic, take a breath and try to ‘reframe and rethink’ about the current situation. I’m suggesting we reframe those investment losses by comparing your current retirement portfolio to the current value of your house. By doing this exercise, we can think about loss and gain a bit differently.

First off, we need to imagine a world where you can see the value of your home with as much precision and frequency as you see the value of your TSP and other investment assets. The cumulative value of each and every home in your city will now be called the ‘market.’ For the sake of the exercise we will even call this the Berkley Home Stock or ‘BHE.’ (I live in Berkley, Michigan so I take the naming rights!)  

Your house is now listed on the BHE and you can track the prices fluctuations, gains and losses. However, remember, the value on the BHE is not what you think it’s worth, its value is what someone will pay you for it, just like the stock market.

Now that we can see what your home is worth in real time, how is it doing? What is the current value of your home on the BHE right now? What was it two months ago? If you needed to put your home on the market today, what would it go for?

Here in Michigan, I’m guessing that that price would be significantly lower than it was a month ago, maybe even 20 to 25% lower. Why?

The concern over the COVID-19, growing furloughs, layoffs and unemployment locally and recessions has driven demand for homes (and stocks) down. Nobody wants to buy your house right now, especially at the price it was ‘worth’ two months ago.  

When demand for a good or service goes down, the price of that good or service will also fall until a time when prices decline enough to attractive to new buyers. This is the market finding a ‘bottom.’ Investors also call this ‘buying low.’ 

Now you could tell me:  

“Tony, of course I wouldn’t sell my home! I would be a fool to sell it right now. As a matter of fact, I’m not even in the market to sell it. The kids are in a good school, we love our neighbors and we just refinished the kitchen. I may sell in 10 or 15 years so today’s price on the BHE doesn’t matter one bit. When I’m ready to sell and move then the price will matter. Besides, that’s down the road, values will be much higher in 10 years. Real estate ALWAYS goes up.”

Do you see where I’m going with this?

Take that same thinking on real estate and apply it to your retirement assets.

Are you moving/retiring tomorrow or in 10-15 years? If you are not retiring this year, then throw away your statement and ignore the BHE, the DJIA, the C-Fund or any other ticker you see scroll across the bottom of the screen. Those real-time numbers are broadcasting the current state of affairs, not the number that you will actually see when it comes time to sell.  

I know real estate and investments and your retirement accounts are different, but the forces of supply and demand that drive the price up and down are not different at all. How we think and feel about loss in retirements investments versus real estate, that’s the real difference and the real problem area, and it is a simple one of mindset.

Again, the biggest problem that can occur is when a federal employee gets nervous and sells at the very wrong time. If you have well-diversified portfolio (or perhaps a nice well-maintained home with an open concept kitchen) and there are some short-term losses, stay calm. Just as your home will come back in value, there is plenty of time for the actual market to come back. COVID-19 will not be around forever and you’re not moving now or retiring now.

The only value that matters is the value of your account on the day that you need it.


Remember, you don’t decide to move just because you can see the value of your home fall dramatically on some exchange. Even when the heavy rains come and everyone on the block sees their basements flood, you know that the water will eventually dry out and everything will return to normal.

Have the same mindset with your portfolio. Sure, stocks have taken a beating in 2020, but the only value that matters is the value of your account on the day that you need it.

Lastly, remember this. Savvy real-estate investors always look for great deals and panicky homeowners so they can take make profits. This is where they see long-term opportunity. Learn from them and apply it to your portfolio. Rather than fret about your existing investments, take a look at the rest of the good deals out there and perhaps decide to become a buyer.  

After all real estate err… stock prices are 25% off right now. That’s quite a sale and for a savvy investor, that’s quite the opportunity, especially when the value doesn’t matter today, but only on the day that you need it.

“The opinions and forecasts expressed are those of the author, and may not actually come to pass. This information is subject to change at any time, based on market and other conditions and should not be construed as a recommendation of any specific security or investment plan. Past performance does not guarantee future results.”

Securities offered through Securities America, Inc., Member FINRA/SIPC. Advisory services offered through Securities America Advisors, Inc. Mission Point Planning Group and Securities America are separate companies.

About the Author

With over 17 years of experience as a financial planner, author and educator, Anthony Bucci helps Feds ‘cut through the noise’ and make retirement decisions free from opinion, emotion and conjecture. Find out more about Anthony by visiting www.missionpointplan.com. Securities and advisory services offered through LPL Financial, a registered investment advisor. Member FINRA/SIPC.