Does the TSP G fund beat inflation? (2024)

Does the TSP G fund beat inflation?

Nope. The G won't beat inflation. So if your investment goal is to have a return the outpaces inflation, it's not the fund you want to be all-in on. You might want to consider allocating some to other ones.

Does the G fund beat inflation?

This trend slowly dwindled by the end of the 1990s, though. From 2000 to 2010, the average difference between the G-Fund's growth and inflation was just 2.01%- which is not bad considering the G-fund beat inflation each year.

Is my money safe in the TSP G fund?

The G Fund is invested in U.S. Treasury securities specially issued to the TSP. Payment of principal and interest is guaranteed by the U.S. government. Thus, there is no “credit risk.”

Is the TSP G fund a good investment?

Long-Term Rates and Short-Term Security

The way the interest rate is calculated on the G Fund, along with investing in short-term maturities, gives TSP investors the advantage receiving longer-term rates. In plain English, you get a very good deal the rest of America's investors do not get. Short-term notes are safer.

Does the G fund go up when interest rates rise?

Also, when interest rates rise, the G Fund rate will rise right along with them — again, without the loss of principal that you would experience in the F Fund under the same circ*mstances. From this perspective, as far as bond funds go, the G Fund is still a better deal than just about anything else out there.

What is the average return on the TSP G fund?

Basic Info. Thrift Savings Plan G Fund Monthly Returns is at 0.38%, compared to 0.33% last month and 0.35% last year. This is higher than the long term average of 0.37%.

Should I put all my money in the G fund?

The G-fund can be an incredible tool but is rarely the best option for your entire portfolio. Because everyone's situation is different, the best portfolio is invested in the mix of funds that matches your stage of life and financial situation, but almost always should include some stocks.

What is the most secure TSP fund?

Government Securities Investment Fund (G Fund)

The G Fund invests in a special non-marketable treasury security issued specifically for the TSP by the U.S. government. This fund is the only one in the TSP that guarantees the return of the investor's principal.

What is the best performing TSP fund?

The C Fund has grown 7.49% in 2024, marking the best performance among the TSP's core funds.

What is the most aggressive TSP fund?

But to summarize that article, the 5 core funds can be broken down into conservative and aggressive funds. The conservative funds are the G and F funds and the aggressive funds are the C, S, and I funds.

How long is the TSP G fund good for?

The Treasury securities used in the G Fund rate calculation have a weighted average maturity of approximately 13 years.

Is the TSP not doing well?

The vast majority of offerings in the 401(k)-style Thrift Savings Plan did not have a good month in December—or a good year in 2022 for that matter. The S Fund, invested in small and mid-sized businesses, had the worst performance for December, losing 6.55%. It was down 26.26% for 2022.

How much should you be investing in TSP?

There is no such thing as too much money in the Thrift Savings Plan. If you want your TSP balance to be able to generate an inflation-indexed annual income of $10,000, most financial planners will suggest that you have a $250,000 balance at the time you retire.

Why is the G Fund so low?

But the decline in G Fund returns is not because the government has gotten stingy, it is a combination of historically lower inflation and interest rates. For example, if you were to get a mortgage back in 1990, you would have an interest rate of around 10%!

What is the TSP performance in 2024?

After a strong finish in December 2023, Thrift Savings Plan started 2024 with negative returns in January. After a strong finish in December 2023, Thrift Savings Plan started 2024 with three funds posting negative returns in January. The remaining 12 funds posted positive returns.

Why is the TSP F Fund losing money?

But the G Fund does not, the F fund does. It's down because the Federal Reserve has been raising interest rates. But those bonds, you know, even the corporate bonds, it doesn't mean they're not going to pay off. And it certainly doesn't mean that they're not paying interest, which they continue to do.

Which TSP fund is S&P 500?

The C Fund holds all the stocks included in the S&P 500 Index in virtually the same weights that they have in the index. The performance of the C Fund is evaluated on the basis of how closely its returns match those of the S&P 500 Index.

What do most people do with their TSP when they retire?

Your TSP account is a portable retirement benefit. This means that when you withdraw your account, you can have the TSP transfer part or all of your single pay- ment or certain monthly payments to a traditional IRA or an eligible employer plan (for example, the 401(k) plan of a new employer).

Which is better the F fund or the G fund?

In periods of falling interest rates, the F Fund will experience gains from the resulting rise in bond prices. So in the long run, you may expect F Fund returns to exceed those of the G Fund; however, you should also expect greater price volatility (up and down movements).

Is the G fund like tips?

While the G Fund does not guarantee inflation protection, it is highly likely to provide it, and then some. TIPS guarantee your principal against inflation and pay a fixed rate of interest on that principal every six months until maturity.

How to retire a millionaire with TSP?

Is TSP better than 401K?

A TSP and 401K are similar, but they have their distinct differences, too. If you are a Federal Government employee, a TSP is the better choice. It has lower fees, higher matching, and there are still many ways to customize it how you'd like with investments and withdrawal options.

Is TSP better than IRA?

Basically, your agency will contribute money into your TSP account based on how much you are contributing. There is no match when you invest in an IRA. Another big difference between the TSP and IRAs is how much you can contribute every year. As of 2021, you can invest significantly more into the TSP compared to IRAs.

What is the recommended TSP allocation by age?

In The Elements of Investing: Easy Lessons for Every Investor , Burton Malkiel recommends these age-based asset allocations: 20-30s – bonds 10-25%, stocks 75-90% 40-50s – bonds 25-35%, stocks 65-75% 60s – bonds 35-55%, stocks 45-65%

What is the recommended asset allocation for a 60 year old?

You may have heard of age-based asset allocation guidelines like the Rule of 100 and Rule of 110. The Rule of 100 determines the percentage of stocks you should hold by subtracting your age from 100. If you are 60, for example, the Rule of 100 advises holding 40% of your portfolio in stocks.