May TSP Returns: Significant Gains With One Fund Up 11.2% in 2024

One TSP Fund—the most widely held Fund—is up 11.2% (so far) in 2024. Only one TSP Fund is down.

TSP Funds End Rally on Final Day of the Month

The three major stock indices all posted gains in May. A significant rally on the last day of the month made a big difference.

The S&P 500 was up 4.8%. That is its best month since February. That is also the index on which the C Fund is based. The S&P 500 index went up 0.8% on Friday, May 31st, 2024.

The Dow Jones average was up 2.3% in May. This was its best performance since December. It went up 1.5% on the last day of the month.

Those who pay close attention to the stock market will recall the Dow Jones Industrial Average breaking 40,000 for the first time in history earlier in May. The blue-chip index then dropped over 3%, with its sharpest two-week slide in over a month. Fortunately for TSP investors, the rest of the market continued upward.

When interest rates were low, investors invested in growth stocks when the market declined. Lately, investors are investing in shares that trade at lower multiples of future earnings. This means investors are turning away from technology stocks and investing in industries like utilities and energy.

The S&P 500 index had its most robust May performance since 2020. One stock trader commented on the market performance, “[O]verall inertia is one that’s in a pretty solid uptrend. In other words: (we are in) a bull market until proven otherwise.”

TSP Winners in May

The C Fund is the most popular Fund for TSP investors. 33.6% of TSP participants’ investment dollars were invested in the C Fund as of April 30, 2024.

The G Fund is now in second place with 26.7% of investor’s dollars as TSP investors have gradually added more funds into the C Fund since the market has recovered from its most recent decline.

This means the recent stock results are excellent news for those investing in the C Fund. It is up 11.29% in 2024 and 4.96% in May.

The I Fund (international stocks) is much less popular among TSP investors. 3.6% of TSP investors’ assets are invested in the I Fund. But, for those who have invested in this Fund, it was up 4.86% in May—the Fund with the second-highest returns for the month.

The G Fund, often the most popular choice among TSP participants, is up 1.82% this year and up 0.41% in May. For example, the G Fund was the most popular TSP Fund in September 2022 as money flowed into the Fund and away from the stock funds as the market declined. That trend reversed over time, and the market turned and started increasing again. The C Fund is again the most popular core TSP Fund.

TSP Returns for May 2024 and Year-to-Date

FundMay 2024Year-to-Date
G Fund0.41%1.82%
F Fund1.69%-1.56%
C Fund4.96%11.29%
S Fund3.36%3.38%
I Fund4.86%7.59%
L Income1.58%3.46%
L 20251.89%4.04%
L 20303.07%5.92%
L 20353.33%6.29%
L 20403.58%6.69%
L 20453.80%7.01%
L 20504.02%7.37%
L 20554.67%8.84%
L 20604.67%8.84%
L 20654.67%8.83%

Lifecycle Funds and TSP Investors

The Lifecycle TSP Fund (L Funds) with the most assets is the L 2030 Fund. It had $56.3 billion in assets as of April 30, 2024. At the other end of the spectrum is the L 2060 Fund. It had $4 billion in assets as of April 30, 2024.

As of April 30, 2024, the TSP had total assets of $872 billion. To put this size into perspective, here is a quote from Morningstar:

Technically, the Federal Thrift Savings Plan, or TSP, isn’t a 401(k) plan, as it is not organized under Section 401(k) of the IRS tax code. Effectively, though, TSP walks like a 401(k), talks like a 401(k), and quacks like a 401(k), which makes it in my book the world’s largest such plan, at $800 billion. (In comparison, the biggest actual 401(k) plan, Boeing’s, possessed but $50 billion at last report.)

This Federal Retirement Thrift Investment Board (FRTIB) chart displays TSP assets for each L Fund.

Bar graph showing the total L Fund assets in the TSP as of April 30, 2024
Source: FRTIB

TSP investors are having a good year. Any stock investor will experience good and bad years; the TSP is no exception. For now, enjoy the ride and be grateful your future retirement income is expanding courtesy of the TSP—one of the best benefits available to federal employees.

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