In my article from March 16, 2015, on the topic of the TSP’s ten-year compound returns, I noted that the Thrift Savings Plan had not yet updated their fund sheets to include the year 2014. Within a week of my article, the TSP updated the sheets and we now have some new statistics. Keep in mind that statistics have limited (if any) probative value. Mark Twain once said (quoting Benjamin Disraeli): “There are three kinds of lies: lies; damned lies and statistics.”
TSP fund sheets are two-page, relatively detailed, descriptions of each TSP fund. If you would like to review them, you can find them in the “forms and publications” section of the TSP website.
The new statistics don’t have a lot of surprises. For example:
- The G fund is still far and away the largest fund, representing 43.5% of the money in the TSP.
- The C fund is second, representing 32% of TSP money and having more money than the other two stock funds combined. The S fund has 11.5% and the I fund has 7.6%.
- The smallest of the funds is the F fund with only 5.4% of the money in the TSP.
Since their inception, all of the funds have outperformed inflation. In the following list of fund returns since their inception, be aware that the funds were introduced on different dates, making comparison difficult, if not impossible.
- The C fund has an average annual return of 10.43%. It was introduced on 01/29/1988.
- The S fund has an average annual return of 9.19%. It was introduced on 05/01/2001.
- The F fund has an average annual return of 6.66%. It was introduced on 01/29/1988.
- The G fund has an average annual return of 5.43%. It was introduced on 04/01/1987.
- The I fund has an average annual return of 4.56%. It was introduced on 05/01/2001.
So what do these statistics tell us about the future return of TSP investments? Not a thing. Nonetheless they are interesting; George Bernard Shaw was quoted as saying: “It is the mark of a truly intelligent person to be moved by statistics.”
