10 Investment Opportunities of the Thrift Savings Plan

The thrift savings plan is a type of retirement plan that is available for federal employees. The thrift savings plan is designed to provide an option similar to the 401k in the corporate world. Here are a few options that you have to invest in with the thrift savings plan. 

1. G Fund

The G fund is a mutual fund that invests in certain government-backed securities. Originally this was the only investment option for those that put money into a thrift savings plan. The investments that are in the G fund are not available to the general public. This fund is one of the safest investments around because each security is guaranteed by the federal government. 

2. F Fund

The F Fund is a fixed income index fund. The money that is invested into this fund is put into the Barclays U.S. Debt Index fund. Therefore, as the Barclays Capital Aggregate Bond index moves, the F fund value will move as well. This fund was added as an option to the thrift savings plan in 1988.

3. C Fund

The C Fund is a mutual fund that deals with common stock. The money from the fund is invested into the Barclays Equity Index Fund. This fund is designed to replicate the movements of the stock market and the S & P 500. Historically, the stock market has always appreciated in value over the long term. This means that over the long run, this fund will appreciate in value. This fund became an option for investors in 1988 as well.

4. S Fund

The S Fund is a fund that invests into small-cap stock. The S fund invests its assets into the Blackrock's Extended Market Index Fund. This fund invests in companies that have small market capitalizations in order to create a large potential for growth for the investors. This option did not become available to federal employees until 2001.

5. I Fund

The I Fund is a mutual fund that invests in an international stock index fund. This fund invests its assets into Barclays EAFE Index Fund. This option was also made available in 2001. 

6. L Income

This is a life cycle fund that is designed to pay those that are already retired. This represents the section of federal employees that have already worked a number of years and they are currently receiving payments. 

7. L2010

This is a fund that is designed for investors that plan on retiring between 2010 and 2014. This fund has automatically transitioned to a low-risk portfolio over the years as the employees have gotten closer to retirement.

8. L2020

This fund is designed for individuals that plan on retiring between 2015 and 2024. This fund has a little more risk than the L2010 fund, with a mix of equities and fixed income securities.

9. L2030

This fund is designed for investors that plan on retiring between 2025 and 2034. This fund is mainly comprised of equities that are designed to build capital in the portfolio. 

10. L2040

This is a life cycle fund with a target date of 2035 or after for retirement. This fund has a little higher risk as the employees have a long time horizon before they reach retirement. 

blog comments powered by Disqus