The C Fund continued its strong performance in September, marking the fifth consecutive month of positive returns. Except for April, when it lost 4%, the fund has been positive every month in 2024. It has also been the best performer among the five core funds over the last 10 years—quite impressive indeed.
In my meetings with federal employees, I often hear that the C Fund is the best, and many want to invest all or most of their money in it due to its recent outperformance. While it is true that the C Fund has been the best performer lately, this does not guarantee it will be for the next ten years. In fact, there have been extended periods in the last 100 years when the C Fund had a zero percent rate of return! I caution employees and retirees against putting all or most of their retirement assets in the C Fund. Our head of investment strategy recently wrote an excellent article on this topic, which you can read here. https://stwserve.com/zero-percent-return-for-the-c-fund-over-the-next-10-years/
Moving on to market news, the Federal Reserve began its much-anticipated rate-cutting cycle in September. Market watchers will now turn to third-quarter earnings for signs of the U.S. economy’s strength. Will inflation rise this month? What about the upcoming election? There is always something to worry about for market watchers.
What should you do about all this confusion and uncertainty? At a minimum, I strongly encourage you to attend our webinar on TSP (schedule in the link below). Your TSP is a critical part of your retirement planning. I also offer complimentary consultations to help federal employees develop a strategy they can stick to through the ups and downs of market cycles (my calendar link is below). Our webinars are free, so there is no excuse! Successfully managing 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 sooner rather than later!
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 here. https://stwserve.com/webinars-and-seminars/webinars-for-federal-employees/ You can also schedule a complimentary consultation with me using this link. https://calendly.com/jennifer-meyer-2/part-2a-jennifer.
Monthly and year-to-date returns effective September 30, 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 | 4.56% | 11.51% | 36.29% | 28.57% | 25.28% |
| 2024 YTD | 3.31% | 4.52% | 22.04% | 11.69% | 13.17% |
| September | 0.33% | 1.34% | 2.13% | 1.55% | 0.77% |
| August | 0.35% | 1.43% | 2.42% | 0.25% | 3.15% |
| July | 0.39% | 2.33% | 1.21% | 6.23% | 2.86% |
| June | 0.38% | 0.94% | 3.58% | -0.10% | -1.62% |
| May | 0.41% | 1.69% | 4.96% | 3.36% | 4.86% |
| April | 0.35% | -2.47% | -4.08% | -6.46% | -3.17% |
| March | 0.38% | 0.87% | 3.22% | 3.33% | 3.36% |
| February | 0.33% | -1.41% | 5.34% | 6.03% | 2.74% |
| Jan 2024 | 0.34% | -0.19% | 1.68% | -2.41% | -0.22% |
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 September 30, 2024. (source, TSP.gov).
| Year | G Fund | F Fund | C Fund | S Fund | I Fund |
| 1 year | 4.56% | 11.51% | 36.29% | 28.57% | 25.28% |
| 3 Year | 3.63% | -1.31% | 11.88% | 1.29% | 5.78% |
| 5 year | 2.66% | 0.41% | 15.93% | 10.74% | 8.50% |
| 10 year | 2.47% | 2.00% | 13.37% | 9.72% | 6.04% |
| 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!
Until next month,
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Jennifer Meyer, CFP®, ChFEBC℠, AIF®
A seasoned financial advisor, Jen is renowned for her expertise in federal benefits and financial planning for feds. Jen’s nearly 30-year industry background coupled with her CERTIFIED FINANCIAL PLANNER™ and Chartered Federal Employee Benefits Consultant℠ designations empower her to guide clients confidently on the path to financial independence. Growing up in a family of federal employees, she’s incredibly proud to serve the federal community. Known for her empathetic approach and deep understanding of economic impacts on planning, Jen is dedicated to her clients’ financial prosperity.
Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, CFP® (with plaque design) and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.
**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.***
