Federal Employees News Digest

TSP: Reasonable gains—for some funds—over a rough year

Federal employees who participate in the Thrift Savings Plan got a perhaps unexpected gift this holiday season: robust gains.

The TSP was created in the 1980s to provide feds with a retirement savings option with a range of diverse investment opportunities, similar to then-new 401(k) plans. And over the past year—despite the COVID pandemic and concomitant unemployment and economic shocks—key portions of the fund performed very well, providing those who selected them with double-digit gains.

The C fund, which holds more than $220 billion in assets and invests in large- and mid-sized U.S. company stocks under the S&P 500, gained 18.31% in 2020, a letdown compared with the 31.45% for 2019, but still a strong showing in what was a disappointing year across the broader economy.

Many of TSP’s other funds provided respectable returns. The I Fund, an international stock index fund, gained 8.17%, with the G fund, made up of government securities and designed to mirror inflation and hedge against losses, came in at a gain of 0.97%.

TSP also offers Lifecycle funds, which allow feds to invest via simplified choices that reflect their financial goals over time—adjusting investments from higher risk and reward early in their lifecycle to lower risk and tapered rewards later. The Lifecycle Income fund has been providing a 5.15% return.

For monthly performance figures, and more detail in general, on Lifecycle and other TSP funds, go to: https://www.tsp.gov/funds-lifecycle/.


Reader comments

Tue, Jan 26, 2021 Michelle Heiker Deer River, MN

Article should mention the S fund was the clear winner for 2020 with a 31.85% return.

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2021 Digital Almanac

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