Most TSP funds suffer losses in May

Tom Trabucco, Director of External Affairs, TSP

wfedstaff |

Stocks rebounded Wednesday after stronger-than-expected increase in pending home sales, but overall May was a pretty rough month for those with money in the stock market.

After reaching a 2010 peak in late April, the Dow fell 7.9 percent last month for its worst May since 1940.

As a result, last month was a pretty dismal one for many funds in the Thrift Savings Plan.

Tom Trabucco is Director of External Affairs for the Federal Retirement Thrift Investments Board and says the range of losses was pretty dramatic.

“Negative returns ranged from -1.50 for the L Income fund to -11.20 percent for the I fund. Worries about problems in Greece and the Euro cropped up in late April and spilled into May. Then, of course, on May 6, U.S. Stock markets experienced what has come to be known as the ‘Flash Crash’ . . . when the Dow fell almost 1,000 points in a very short period of time.”

After that, investor confidence waivered for the rest of the month.

As a result, the TSP returns for May are as follows:

Fund G Fund F Fund C Fund S Fund I Fund
Month 0.28% 0.85% -7.99% -7.51% -11.20%
YTD 1.37% 3.78% -1.49% 6.56% -12.55%
12 Month 3.25% 8.48% 21.09% 34.21% 5.52%
L Funds L Income L 2010 L 2020 L 2030 L 2040
Month -1.50% -1.64% -4.98% -6.07% -6.97%
YTD 0.70% 0.68% -1.11% -1.49% -1.91%
12 Month 6.84% 8.00% 13.01% 15.21% 16.89%

Despite the negative returns during May, Trabucco says returns for the year are still pretty decent for most funds.

“When we publish these returns, we give you the month, we give you the year-to-date and then we give you the 12 trailing months so that you can remember that 2009 was a good year. In the second half of the year, we came back pretty strongly.”

He adds that even if you are close to retirement, you shouldn’t really be concerned if you have invested wisely.

“Once you do hit your target date, you’re not going to withdraw all of your money, most likely, at that point. Some people will, and they’ll put it in another investment, but an awful lot of people, when they do get to that point and start withdrawing it, they take it in monthly payments from the TSP and draw it out over the next 10 or 20 years in order to supplement their defined benefit payments.”

As always, Trabucco reminds TSP participants to look at their retirement savings as a long term investment if they hope to get the most bang for their buck.

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THRIFT SAVINGS PLAN TICKER

Oct 21, 2021 Close Change YTD*
L Income 23.3044 0.0046 3.52%
L 2025 12.1079 0.0054 6.40%
L 2030 42.9634 0.0268 7.92%
L 2035 12.9286 0.0088 8.58%
L 2040 49.0234 0.037 9.26%
L 2045 13.4534 0.0109 9.83%
L 2050 29.5260 0.0261 10.41%
L 2055 14.6038 0.0181 12.65%
L 2060 14.6037 0.0182 12.65%
L 2065 14.6035 0.0181 12.65%
G Fund 16.6867 0.0006 0.99%
F Fund 20.7462 -0.0407 -1.40%
C Fund 68.4916 0.2095 15.90%
S Fund 87.8446 0.5128 11.66%
I Fund 39.2498 -0.1287 8.56%
Closing price updated at approx 6pm ET each business day. More at tsp.gov
* YTD data is updated on the last day of the month.