The TSP funds are continuing their upward movement. Investors in the stock funds of the thrift savings plan will be happy once again as their retirement assets continue to expand.
The big winner for January is the S fund with a monthly gain of 3.53%. The rate of return for the past 12 months is 51.53%. The monthly gain and the gain for the past twelve months exceeds the gain for any of the other TSP funds.
Coming in second, for the month of January, is the common stock fund (the C fund). It returned 1.80% in January and it is up 34.44% for the past 12 months.
The International Stock Fund is up 1.32% for January and up 45.94% for the past twelve months.
For those investing in bonds, the F fund advanced 0.80% in January (and up 4.84% for the past 12 months). The G fund advanced 0.29% in January and it is up 4.06% for the past 12 months.
For a variety of information on return rates for each TSP fund, go to FedSmith.com’s TSP page at http://www.fedsmith.com/tsp/.
Financial planners often stress the need for diversification in your retirement portfolio. It is not possible to predict which type of investment will perform the best over time. Obviously, investors in the various stock funds have done very well over the past year and have done the best over the past decade. (Keep in mind the S and I funds have not been available until fairly recently.) However, the S and I funds have been very profitable for investors in these funds. With a return rate of 42.92% in 2003, the S fund topped all others.
As we noted in a related article recently, TSP investors have the benefit of much lower expenses than private sector 401(k) investors. When used wisely, these funds can provide a major source of retirement funds for a federal employee that invests in the funds regularly throughout a federal career.