Best TSP Fund Return in 2019: 31.45%

Despite gloomy investment predictions for 2019, TSP investors fared well. One TSP fund had a return of 31.45% for the year.

The TSP stock funds had another good month in December which is good news for all Thrift Savings Plan (TSP) investors.

Fund With the Highest Return in 2019

The best news is that the C Fund finished up with a return of 31.45% for the year. The last year in which the C Fund had a return this good was 2013 when the annual return was 32.45%. This is only the fourth year in which the C Fund has returned 30% for higher. The C Fund had the highest annual return for any of the TSP funds in 2019.

The S Fund finished with a yearly return of 27.97%. This fund had the second-highest year rate of return among the TSP funds. The L 2050 and the I Funds came in with an annual return of 23.33% and 22.47% respectively.

The S&P 500 index was up 29% in 2019—the best returns for this index since 2013. The TSP’s C Fund is based on the S&P 500 index and both the C Fund and the C Fund had the best rate of return since 2013.

The trailing fund for the year was the G Fund with an annual return of 2.24%. The G Fund is considered the safest of the TSP funds as it always has a positive return. The downside, obviously, is that the annual return often lags way behind the other funds so the safety of the G Fund comes with a price in many years.

2019 Returns Compared to 2018

For TSP investors with a longer memory, last year at this time investors were not as euphoric.

In December 2018, with the exception of the bond funds, all of the stock funds in the TSP were down for the year. The G fund beat all other funds with a positive return of 2.91% in 2018. The L Income fund was up 0.71% and the F fund, which lagged most funds throughout the year, still ended up with a modest positive return of 0.15% for all of 2018.

In comparison to this year, in 2018 the C Fund went down 4.41% and the return for the S Fund was -9.26%.

In fact, one year ago, the mood among stock investors for the stock market in 2019 was gloomy. The global economy appeared to be getting weaker. Stocks and bonds were both falling in value and money managers worried the Federal Reserve’s interest-rate increases would turn an economic slowdown into a recession or a longer downturn in the price of stocks.

But, on the last day of 2019, despite the negative predictions, stock indicators from the U.S. to Brazil to Germany were all up more than 20% for the past year.

For what it is worth, analysts are more optimistic about the stock market in 2020 and generally see at least modest positive returns for the year.

Of course, as we saw just this past year, accurate predictions are hard to come by and timing the market based on future prognostication is risky and trying to buy or sell stocks based on future predictions can actually reduce an investor’s returns over time.

Here is how the funds in the Thrift Savings Plan have fared for the past month, the year-to-date and for the past 12 months.

G Fund F Fund C Fund S Fund I Fund
Month 0.16% -0.08% 3.01% 2.15% 3.24%
YTD 2.24% 8.68% 31.45% 27.97% 22.47%
12 Month 2.24% 8.68% 31.45% 27.97% 22.47%

L Income L 2020 L 2030 L 2040 L 2050
Month 0.74% 0.86% 1.83% 2.15% 2.43%
YTD 7.60% 9.38% 17.60% 20.69% 23.33%
12 Month 7.60% 9.38% 17.60% 20.69% 23.33%

We wish all TSP investors our best wishes for more positive returns in 2019!

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