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I am 20-25 years from retirement. For the past 8 years or so, I have been investing about 40% in the S fund, 40% in the C fund, and 20% in the I fund. Recently, I decided to invest 100% in the S fund, which I believe will increase both short-term risk and long term rewards. My reasoning:

1. 20-25 years is a long horizon. I have no concerns if my TSP fund dips even 50% in the course of one or even 5 years. I have little doubt it would rebound, and I have the time to wait for it to do so.

2. Even with 100% in one fund, it is still very well diversified because that fund invests in hundreds of companies.

3. Even with the recent federal budget fights (debt ceiling, etc), employment with the federal government carries a very low risk of losing your job. Lower than almost any equivalent private sector job. Given that, and my relatively long time horizon until retirement, when I look at my overall exposure to financial risk, I can afford to carry a high amount of risk in investing. Not thoughtless risk, of course, but it certainly affects my balance when looking at the risk/reward spectrum.
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