Highest Point of TSP Investor Satisfaction and New Lifecycle Fund Launch
In the monthly meeting of the Federal Retirement Thrift Investment Board (FRTIB), the FRTIB members were advised that overall participant satisfaction with the website and the Thriftline hit new high points. Satisfaction with the website and mobile app was reported at 94%, and satisfaction with the ThriftLine was reported at 93%.
On July 26, 2024, a new L Fund will be introduced. It will be the L 2070 Fund. This Fund is designed for TSP participants born after 2004. It will be an aggressive Fund with a higher percentage of TSP stock funds included. The reason for this is that younger federal employees have more years before they will retire.
A longer time before a likely retirement date equates to more time a person will be investing in the stock market. While the stock market goes up and down, stocks provide a higher rate of return than bond funds over longer time periods. The higher stock allocation in a Lifecycle Fund means it is more likely these investors will have a larger nest egg in the TSP when they retire.
All TSP Funds Showing Positive Returns
TSP investors are enjoying a successful year. Every TSP Fund shows a positive return; even the F Fund is up this year. The C Fund is far ahead of the other funds, with a return of 15% for the year.
As noted in Marketwatch: “Something unusual is happening on Wall Street that is helping to boost the confidence of stock-market bulls as the first half of 2024 comes to a close.” The “something unusual” is that corporate-earnings estimates, which typically decline throughout the course of a year, are going up. S&P 500 companies have had their earnings-per-share estimates increase by 2.4% since late in December.
Does this mean more upward movement in the stock market will occur? Not necessarily. Interest-rate cuts by the Federal Reserve are largely anticipated but may not occur. A national election is coming up and is likely to be volatile and nasty—with the possibility of unintended consequences. And, of course, there are still two significant wars raging in different parts of the world. There is a possibility these conflicts will expand to other areas as well with unpredictable consequences.
As usual, there are always short-term risks when investing in stocks.
C Fund Continues to Grow
This trend in corporate earnings has benefitted the C Fund, which continues to grow its lead as the largest fund in the Thrift Savings Plan.
The C Fund now has 34.3% of participant allocations in the TSP. As the stock market continues to increase in the latest market trend, more money flows into the C Fund. In one month, the C Fund assets from participants went from $293.1 billion to $308.4 billion. At the end of December, the C Fund had $270.9 billion in investor-allocated assets.
At the same time, the G Fund’s investor assets went from $234.1 billion (27.7%) at the end of December to $230.4 billion (25.7%) at the end of May. This trend is likely to continue when June statistics are calculated and investors continue to show confidence in the upward trend continuing in the near future.
Here are the latest TSP returns.
TSP Returns So Far in June and in 2024
| Fund | Month-to-Date | Year-to-Date |
|---|---|---|
| G Fund | 0.31% | 2.13% |
| F Fund | 1.67% | 0.08% |
| C Fund | 3.33% | 15.00% |
| S Fund | -0.63% | 2.72% |
| I Fund | -1.34% | 6.15% |
| L Income | 0.61% | 4.09% |
| L 2025 | 0.67% | 4.74% |
| L 2030 | 0.90% | 6.87% |
| L 2035 | 0.96% | 7.32% |
| L 2040 | 1.02% | 7.77% |
| L 2045 | 1.06% | 8.15% |
| L 2050 | 1.10% | 8.54% |
| L 2055 | 1.15% | 10.09% |
| L 2060 | 1.15% | 10.08% |
| L 2065 | 1.15% | 10.08% |
