During the Great Recession of 2008-2009, the S&P 500 index lost 50% of its value. The C fund of the federal Thrift Savings Plan tracks the S&P 500.

The Great Recession (which was a brief 17 months as recessions go) followed the boom years of 2002 through 2007. What goes up also goes down. At least so far.

All of which is why federal investors, who have grown more sophisticated over the years, need to be careful. How they behave prudently or panic during a downturn can determine how much they will have in their retirement nest egg when they leave government. The number of TSP millionaires has gone over 95,000 at last count. Most of them are long-time investors who continued to buy shares in the TSP’s three stock index funds (C, S and I) during the recession, even as millions of other investors fled to the “safety” of the treasury securities G fund.

So what’s an investor do? Plan ahead and don’t panic is what most of the pros say. But knowing what you should do during the next stock market crash and doing it are two very different things. Financial planner Arthur Stein has a number of clients who are TSP millionaires. Most aren’t but hope to be. He says that feds are now investing more in the C fund than the low-yield G fund. And that’s a good thing. Up to a point! Which is what we will be talking about on today's episode of Your Turn.