Best TSP Fund in 2017? Still the I Fund

All of the TSP funds had positive returns in July and also for the year to date.

Some federal employees may be focused on buyouts or early retirement as they fret about possible changes to federal benefits in various bills pending in Congress and concerns persist about raising the national debt ceiling again or the 2018 budget.

But, while these concerns may be foremost in the minds of many, federal employees investing in the Thrift Savings Plan may want to pay attention to their more immediate financial returns.

Best Returns Among Core TSP Funds

All of the Thrift Savings Plan (TSP) funds had positive returns in July.

The I fund was the most successful with a return for the month of 2.88%. The C fund did not fare poorly either. It had a monthly return of 2.05%.

So far in 2017 the I fund has been the most successful fund with a return of 17.39%. The C fund has a return of 11.59% so far in 2017.

One would expect the G fund to be providing the lowest returns of any of the underlying TSP funds and that is the case. It had a return of 0.19% in July and is up 1.36% so far in 2017.

Best Returns for Lifecycle Funds

For months in which the stock market has positive returns, the L 2050 fund usually has the best returns. That was true in July as the L 2050 fund had a return of 1.82%. The L Income fund had a return of 0.60% in July and it was the lowest return among the lifestyle funds.

So far in 2017, the L 2050 fund is ahead of the others with a return of 10.91%

TSP Returns for July, YTD and Past 12 Months

Here is a summary of the returns for all of the TSP funds for the month of July, so far in 2017 (YTD) and for the past 12 months.

G Fund F Fund C Fund S Fund I Fund
Month 0.19% 0.43% 2.05% 1.11% 2.88%
YTD 1.36% 2.92% 11.59% 8.61% 17.39%
12 Months 2.12% -0.24% 16.06% 16.72% 18.13%


L Income L 2020 L 2030 L 2040 L 2050
Month 0.60% 0.96% 1.42% 1.63% 1.82%
YTD 3.69% 5.96% 8.53% 9.78% 10.91%
12 Months 4.81% 7.79% 11.05% 12.68% 14.24%

Why Are Stock Prices Going Higher?

Stock market indices were up significantly in July. The Dow Jones Industrial Average was 2.54 percent. It was the best return for this index since February.

The S&P 500 index (the index on which the C fund is based) also posted its best monthly gain since February with its July returns. It was up 1.93 percent for the month.

These indices also reached multiple record highs in July. Investors drove up stock prices as a result of strong quarterly reports from major companies. Seventy-three percent of the S&P 500 companies that had reported as of Friday had beat their earnings estimates.

About the Author

Ralph Smith has several decades of experience working with federal human resources issues. He has written extensively on a full range of human resources topics in books and newsletters and is a co-founder of two companies and several newsletters on federal human resources. Follow Ralph on Twitter: @RalphSmith47