Thrift Savings Plan Monthly Update for January 2024, by Jennifer Meyer, CFP®, ChFEBC℠, AIF®
After a tremendous rally into the end of 2023, the first month of 2024 has brought some cooling to markets. In my opinion, this was to be expected as there is still much uncertainty about the course of potential interest rate cuts in 2024.
The C fund was the best performing fund in January, with a positive 1.68% return. The S fund gave back some it’s year-end gain and was negative 2.41% for the month. As we look to the upcoming months, there will be continued speculation around when the Federal Reserve will cut interest rates. The Fed will certainly be watching inflation and unemployment data closely as it continues to strive towards the potential soft landing of bringing inflation down without causing a recession. Most economists felt it was highly unlikely this would be achieved, but are now conceding that thus far, the Fed is on track to accomplish its tricky balancing act.
What Does This Mean for Your TSP?
Remember that markets are forward looking, meaning that they move according to what is predicted to happen in the future. The Fed uses data that is backward looking in making interest rate decisions. No one can time the market with consistent accuracy, which is why it is so important to stay disciplined to a good investment strategy. We offer a monthly TSP webinar and complimentary consultations to help federal employees develop a strategy they can stick to through the ups and downs of market cycles. Please take advantage of the resources available to you! The successful management of your TSP will have a huge impact on your retirement. If you have neglected it in the past, make it a priority to educate yourself this year!
If you have questions on how to best manage your TSP, please schedule a complimentary meeting or attend a TSP webinar. You can find the schedule at stwserve.com/register.
Monthly and year to date returns effective January 31, 2024, and longer-term averages are shown below. (source, TSP.gov)
| Year | G Fund | F Fund | C Fund | S Fund | I Fund |
| Last 12 months | 4.23% | 2.06% | 20.78% | 10.34% | 8.93% |
| 2024 YTD | 0.34% | -0.19% | 1.68% | -2.41% | -0.22% |
| Jan 2024 | 0.34% | -0.19% | 1.68% | -2.41% | -0.22% |
| 2023 Monthly | |||||
| December | 0.39% | 3.72% | 4.54% | 10.45% | 5.39% |
| November | 0.41% | 4.51% | 9.12% | 11.19% | 8.54% |
| October | 0.40% | -1.58% | -2.10% | -6.26% | -3.22% |
| September | 0.35% | -2.54% | -4.77% | -4.90% | -3.51% |
| August | 0.35% | -0.63% | -1.58% | -4.06% | -3.90% |
| July | 0.34% | -0.07% | 3.21% | 5.91% | 2.82% |
| June | 0.32% | -0.36% | 6.61% | 8.31% | 4.57% |
| May | 0.31% | -1.10% | 0.43% | 0.44% | -4.01% |
| April | 0.30% | 0.61% | 1.56% | -2.18% | 2.87% |
| March | 0.35% | 2.55% | 3.67% | -2.90% | 3.11% |
| February | 0.28% | -2.58% | -2.44% | -1.63% | -2.84% |
| January | 0.34% | 3.25% | 6.28% | 10.82% | 8.43% |
Month to month trends as shown above are interesting, but it is important to remember that short term market volatility is to be expected and employees should not be making investment decisions based on short term performance. Following are longer term rates of return for each fund, as of January 31, 2024. (source, TSP.gov).
| Year | G Fund | F Fund | C Fund | S Fund | I Fund |
| 1 year | 4.23% | 2.06% | 20.78% | 10.34% | 8.93% |
| 3 Year | 2.95% | -3.04% | 10.96% | -0.47% | 4.63% |
| 5 year | 2.37% | 0.91% | 14.26% | 8.91% | 7.08% |
| 10 year | 2.33% | 1.84% | 12.61% | 8.58% | 5.03% |
| Inception Date | 4/1/1987 | 1/29/1988 | 1/29/1988 | 5/1/2001 | 5/1/2001 |
Please reach out to us with questions and follow our website for the most recent updates. We are here to serve you! Thank you for your service to our government!
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**Written by Jennifer Meyer, CFP®, ChFEBC℠, AIF®,. The information has been obtained from sources considered reliable but we do not guarantee that the foregoing material is accurate or complete. Any opinions are those of Jennifer Meyer and not necessarily those of RJFS or Raymond James. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. Investing involves risk and you may incur a profit or loss regardless of strategy suggested. Every investor’s situation is unique and you should consider your investment goals, risk tolerance, and time horizon before making any investment or financial decision. Prior to making an investment decision, please consult with your financial advisor about your individual situation. While we are familiar with the tax provisions of the issues presented herein, as Financial Advisors of RJFS, we are not qualified to render advice on tax or legal matters. You should discuss tax or legal matters with the appropriate professional. **
***The Thrift Savings Plan (TSP) is a retirement savings and investment plan for Federal employees and members of the uniformed services, including the Ready Reserve. The TSP is a defined contribution plan, meaning that the retirement income you receive from your TSP account will depend on how much you (and your agency or service, if you're eligible to receive agency or service contributions) put into your account during your working years and the earnings accumulated over that time. The Federal Retirement Thrift Investment Board (FRTIB) administers the TSP.***
