The Thrift Savings Plan (TSP) is one of the military's most valuable retirement benefits, but choosing between the different fund options can feel overwhelming. This guide breaks down each TSP fund in plain language, helping you make informed decisions about your financial future.
The TSP offers five individual funds, each with its own investment focus and risk level. Let's explore what makes each one unique.
The G Fund is often called the "safe" option because it invests in special U.S. Treasury securities that are guaranteed by the government. Key features include:
- No risk of losing money
- Generally lower returns than other funds
- Protection against inflation
- Perfect for conservative investors or those near retirement
While the G Fund won't make you rich quickly, it's the only investment option guaranteed never to lose money.
This fund invests in bonds, providing a middle ground between the safety of the G Fund and the higher risk of stock funds:
- Tracks the Bloomberg Barclays U.S. Aggregate Bond Index
- Higher potential returns than the G Fund
- Some risk of losing money if interest rates rise
- Good for moderate-risk investors seeking steady income
The C Fund mirrors the S&P 500 index, investing in large U.S. companies:
