The TSP is unveiling a new fund in its family of Lifecycle funds: the L 2050 fund. The fund is designed for participants who will begin to withdraw their holdings after 2045 and replaces the now obsolete L 2010 fund.
Like the other Lifecycle funds, the holdings are spread across the five main TSP funds in the most optimal fashion with respect to the fund’s target date in an attempt to generate the most wealth for the owner. Currently, the TSP says the objective of the L 2050 fund is to “achieve a high level of growth with a very low emphasis on preservation of assets.” This strategy assumes that the farther away you are from retirement, the more risk you are willing and able to tolerate. Risk tolerance can, of course, vary depending on the individual.
Based on this principle, the allocation for the L 2050 fund in the short term will break out as follows:
Looking forward to October 2044, the fund breakdown as delineated by the TSP will shift to a more conservative allocation to look like this:
The TSP provides an interactive graph on the L 2050 fund’s information page which shows how the allocation changes into the future.
The asset allocation for the Lifecycle funds is updated quarterly, gradually shifting to the more conservative composition over time. You can get more information about all of the Lifecycle funds on the TSP Web site.
Fund Performance Data
Monthly returns data will be available for the L 2050 fund starting in March, 2011, and annual returns data will be available starting in 2012.
FedSmith.com will be updating our TSP rates to display the daily share prices of the L 2050 fund.