If you are a federal employee, you may be wondering how to plan for your retirement and make the most of your Thrift Savings Plan (TSP). The TSP is a tax-advantaged retirement savings plan that allows you to invest in various funds and options, depending on your risk tolerance and goals. On this tag page, you will find articles and resources that will help you understand the benefits and features of the TSP, as well as tips and strategies to increase your investment returns and secure your future income. You will also learn about the latest news and updates on the TSP performance, fees, withdrawals, and more. Whether you are just starting your federal career or are near retirement, these articles will provide you with valuable information and guidance on how to make the best use of your TSP.
Declines in the value of the stock market are leading to proposed changes in retirement plans and complaints from a few investors that the TSP is taking money from their pockets by placing unreasonable restrictions on trading TSP funds. Here is a summary and a response from a TSP official that gives a more in-depth description of TSP expenses in the TSP funds that will interest to all TSP investors.
As the current stock market doldrums drag on and the value of TSP stock funds dwindle, some TSP investors have been busy moving billions of dollars into the safety of the G fund and out of the TSP stock funds.
It is human nature to panic when you see your stock investments losing money. The result is always the same: small investors dump their stock funds as the market goes down and they usually dump the most money when the market is at its lowest point. To preserve your retirement funds, take a deep breath, step back and look at the bigger picture. It may keep you from making a big mistake.
On October 9, 2007, the stock market hit new highs. On October 9, 2008, the markets hit a multi-year low. Current retirees, those planning on retiring soon and even those hoping to retire in the next five years and concerned. Here is how the TSP funds have fared in the past year–and some hope for the future.
Your TSP funds have probably taken a dramatic hit. Put the situation in perspective before hitting the panic button and making decisions you may regret later.
Are stock market investors at “the point of maximum pessimism”? It isn’t possible to know but there is plenty of evidence to think we are at least in the vicinity. Here is a chart that shows how stocks have fared after dramatic one-day drops and how the stocks had fared one year later.
The stock market has been falling fast and TSP return rates are falling along with the market. And, this will surprise some current and future federal retirees, the current COLA adjustment for next January also dropped in the past month. Here is a quick summary of your TSP returns and the 2009 COLA adjustment.
TSP stock fund returns were all up for August, with the exception of the I fund which took a drubbing and is down more than 17% for the year.
The way to make money in the stock market is to “buy low and sell high.” But many investors follow the opposite practice. They “buy high and sell low.” Current trends show that, once again, the past is prologue and TSP participants are selling stock funds and adding billions into the G fund.
The stock market decline continued in July and the TSP funds reflect the declining values as most of the funds are down for the month, year and and previous 12 months.
