The biggest monthly drop was in the International Stock Index I fund, which fell from 1.19% in May to -8.21% in June. Although the I fund also dropped in June 2021, year over year it was down by 6.77 percentage points.

The second-biggest monthly drop was in the common stock index C fund, which ended June at -6.55% compared to -1.65% in May. The small cap stock index S fund had a return of -7.95% in June compared to -3.53% in May, and the fixed income index F fund posted returns of -1.94% last month compared to 1.13% in May.

Overall, the TSP was down from a year ago and this year, record inflation has affected many sectors of the economy especially energy and food. The Bureau of Labor Statistics reported that from May 2021 to May 2022, the Consumer Price Index for All Urban Consumers increased 8.6%, which is the largest 12-month increase since the period ending December 1981.

Things are not looking much better in the Lifecycle funds, all of which had declining monthly returns in June. The biggest monthly decrease was in the L 2055, 2060 and 2065 funds which ended at -7.25% in June compared to -0.89% in May. The smallest decline was in the L Income fund, which dropped from 0.04% in May to -1.60% last month.

Aside from the L Income fund, Lifecycle funds have remained in the red since April.

If you are working, retired, building a nest egg or living off one, these are tough emotional times. If you want good news, you’ve learned to avoid the financial news or stock market reports. Also national news, international news and, if you are a baseball fan in certain cities like Washington, D.C., you avoid the sporting news, too.

Hopefully you have a good cable package and a personality that lets you sort and live with the good news vs. the not-so-good-news. Which is the purpose of today’s Your Turn radio show: It’s a double-header on the good, the bad and the ugly. We are going to try to cover the waterfront. Our show begins at 10 a.m. EDT on www.federalnewsnetwork.com or 1500 AM in the Washington-Baltimore area. First up, financial advisor Arthur Stein will talk about the future course of your TSP account, and the pros and cons of investing heavily in the never-has-a-bad-day G fund. Many consider it the “safest” investment. But that begs the question: How do you define “safe” when building a retirement nest egg? Federal News Network reporter Drew Friedman will talk about the very latest on the federal pay raise. Then we’ll get into the prospects for a large retiree COLA. Last, but definitely not least, the issues TSP investors are having with the new system.

Hopefully this has something for everyone. Here’s a preview from Arthur Stein on the place of the G-fund in your TSP portfolio:

There are two advantages to the G-fund: Zero volatility and all holdings are guaranteed by the government.

However, G (and F)-fund investors need to recognize that, historically, long-term investments in the G and F-funds lost purchasing power. G-fund annual returns have gradually declined since it was introduced in April of 1987. In 2021, the return was 1.4%, 84% lower than in 1988. The cost of living (inflation) more than doubled over this period.

That leaves TSP participants with a dilemma. Should they invest for:

• The lower volatility and lower chance of losing principal (“safety”) offered by the G and F (bond) funds, and accept the higher chance of declines in purchasing power; or
• The higher potential growth historically offered by the stock funds, accepting higher volatility and market declines for the opportunity to increase purchasing power?

Nearly Useless Factoid

By Daisy Thornton

Source: Sci News

The board, which hosted its first public meeting since a major TSP system update, said on June 28 that there have been some improvements, like a slight decline in wait times for customer service. But participant frustrations and call hold times are still much higher than usual.

To help alleviate the heavy call volumes, the board increased its customer service staff by 66%, up to 800 total representatives at ThriftLine, TSP’s customer service call center.

“That’s the most that we’ve ever had in the history of the TSP,” Tee Ramos, FRTIB’s director of participant services, said at the board meeting. “Our volumes continue to be historically high, though, so we’re working with our vendor to continue to add staff.”

Ramos said the board plans to add another 100 representatives in the next week, as many of the issues have still not been resolved.

The announcement comes after the board updated TSP with a new recordkeeping system, a mobile app, an e-signature function, an optional mutual fund window, among many other changes. After the launch on June 1, TSP participants vented almost immediate frustrations about technical issues and missing account information. Many participants also struggled to log in to the new My Account system. As a result, more TSP participants tried to reach customer service representatives, yielding unprecedented call volumes and hold times at ThriftLine.

Ramos said despite the challenges, the update was necessary because the old system for TSP was outdated. The board was also looking to enhance security and anti-fraud protections for participants.

“Recordkeeping processes are labor intensive. Those services that we had in the past were delivered through legacy technology that made it difficult for us. Our existing technology and infrastructure was not agile and it was not scalable,” Ramos said. “We as an agency wanted to focus more on continuing to provide a top-tier service, ensuring we had a service that was comprised of an agile and scalable IT infrastructure and focusing our FRTIB staff on improving retirement outcomes and the participant experience.”

But many participants continue to voice frustrations, such as the inability to see beneficiary designations in the new account system. Ramos said that issue was a data quality issue for some users.

“We had roughly 266,000 beneficiary accounts where we didn’t transfer their designation over to the new system. This wasn’t an oversight,” Ramos said. “It was due to the quality of the data in our old system. We weren’t confident that it would transfer well from the old system.”

The board has beneficiary forms available for the accounts with missing information, and a process to follow to get those designations, Ramos said. All participants should review their beneficiary information and update it online.

Another common concern was the lack of access to historical financial data going back further than 10 years. Again, Ramos said, the lack of data available in the system is deliberate.

“We looked into historical data usage trends, and there was low usage and high cost associated with maintaining high availability for the 665 million documents that we had online with our old system. There are also [security] concerns about maintaining that amount of data,” Ramos said. “Participants are able to access year-to-date employee contributions and we have 10 years of account balance information that transferred over. That didn’t transfer over on day one, but it is up and live now.”

Historical information has all been transferred, the board said, but it is not readily available in the new My Account. If participants want to obtain additional statements, documents and other messages from the prior system, they are available upon request.

Still, many participants continued to share frustrations about the update. Beyond those frequent concerns, many users also said the new system is unintuitive and difficult to use. In an exclusive Federal News Network survey, respondents said the new TSP interface lacked calculation tools that were available in the old system, and said it was more difficult to find account information.

The challenges are garnering attention on Capitol Hill, too. Congresswoman Eleanor Holmes Norton (D-D.C.) requested an “urgent meeting” with the board to discuss the issues and get an update on the progress of solving them.

Norton previously wrote a letter to FRTIB, calling on the board to explain the cause of technical issues, unprecedented customer service hold times and missing financial information. The board responded to Norton’s letter, saying that they’re making progress to resolve the issues. But Norton said the board’s response did not fully address her questions.

“The Thrift Savings Plan is so essential to federal employees and retirees that FRTIB must immediately fix the problems with the new online system,” Norton said in a June 27 statement. “Constituents have told me of phone wait times of over nine hours, of disconnected calls, and of missing and incorrect information in their accounts.”

The board has not yet responded to Norton’s meeting request.

During that early 2000s super Bear Market, millions of investors lost billions of retirement nest egg dollars. The stock market plunged almost 50%. A heart-stopper for most investors. Especially if they are close to retirement, and even more so if already retired on a fixed pension. Many moved their TSP and 401(k) into “safer” bonds or treasury securities to protect them from losses. But they missed out on the stock market rebound.

Many private sector employees were also forced to take pay cuts ranging from 5-25% in order to protect their jobs. And some companies — including several well-known investment management giants — stopped giving their own employees matching 401(k) contributions, so they could stay afloat. Federal workers did without pay raises for two years. But there were no recession-triggered layoffs. In fact, many agencies grew. The TSP continued to give investors a matching government contribution of up to 5%. Further proof that it’s nice to be in a plan that covers members of Congress too. And workers with enough time in service continued to get WIGs (within-grade raises) worth about 3% every one, two or three years based on their time in government.

Benefits expert Tammy Flanagan said don’t focus entirely on the next recession, whether it is two years, or two weeks, away. Her advice: “What about the next recession. And the next few recessions? Be prepared because it is always something: War, recession, the roof of your house caves in. Always something.” Her advice, particularly for people who are retirement eligible or close to retirement is: Think about waiting. Maybe a delay of two years. In an earlier column, she pointed out that an $80,000 per year fed who works an extra two years — from 60 to 62 — will boost their starting annuity by almost $30,000. That’s also important because while CSRS retirees get full cost of living adjustments no matter when they retire, FERS retirees don’t get any COLA until age 62. Then it’s minus 1% if inflation exceeds 3%. Currently it is running much, much higher. So are you ready? For retirement, the next recession, or both? The Employee Benefit Research Institute says many retirees — federal and private — are not well prepared for retirement. Among other things it says:

• Many retirees say they wish they’d saved more. They may seem obvious but by the time you’ve learned that lesson it may be too late.
• Also, most retirees seem to do better if they have a financial advisor, though many don’t. Or didn’t until later.
• The EBRI also says that 9 out of 10 retirees who have financial advisors feel the value they got “outweighed the cost” of such an advisor.

Nearly Useless Factoid

By Daisy Thornton

Source: World Wildlife Fund

So for an update, we went to Kim Weaver, the director of external affairs for the Board. We had the questions, she provided the answers.

Nearly Useless Factoid

By Daisy Thornton

Source: Smithsonian Magazine

Nobody has to invest in any of the new funds being offered. And only those who do invest part of their optional retirement fund will pay new fees. The rollout — involving 6 million accounts — has been rocky for some. Smooth for others. The new choices are a blessing to many investors while confusing to others. An early 80s retiree from the Nuclear Regulatory Commission said, “If I were younger, I would object to so many because some of them could be weak and go under. Adding another 10 or so would be good. However, I have been withdrawing from the TSP for years, so don’t much care anymore… I sold most of my fund holdings in December, which turned out to be near the top of the market.”

The rollout of the TSP has been bumpy as reported by Federal News Network’s Drew Friedman. So what’s next? Should you embrace the new investments, stick with what you know, or what? For the for-what answer, we turned to, Abraham Grungold. He’s a long time fed, recently retired to a new career as financial coach. He’s a member of the TSPs self-made Millionaire-plus club. Here’s what he said to the complicated  question, is the new TSP right for you?

I have been a TSP participant since the beginning. I have taken advantage of all the benefits that the TSP has to offer. And the TSP has made me successful beyond my wildest dreams. The TSP has a track history of over 30 plus years and it has made many millionaires. The TSP members have desired more investment options and great flexibility.

What are my thoughts on the new TSP? For me I like no frills. What makes me happy is quality, a good price and performance. It reminds me of the car that I drive, a Toyota Camry. It starts up every morning, requires little maintenance and I purchased it a great price. That is how I want my TSP website to work for me. The ability to log in every morning with ease, require little effort on my part to keep up and I want my expenses to remain the lowest in the retirement industry.

The 5,000 new mutual funds offered by the TSP reminds [me] of when my daughter would ask me to get her the new Oreo mint or double fudge cookie.   I go to the supermarket and view all the Oreo selections and find that there are 20 different Oreo flavors.  And every time I buy the new flavor, she tries it and never finishes the bag. She always goes back to the original cookie.

The new TSP website needed an overhaul, a fresh look.  Now the categories jump out at you. The website has now presented those main categories in a distinct way so as you age you can find what you are looking for. As you drill down into the sub-menus it still takes some effort to find a particular TSP form and some sub-menus such as the beneficiary page do not load with ease. OK, there are some bugs to work out. Don’t worry, the TSP board will correct all these issues.

So, what about the 5,000 new mutual funds? The TSP fund already offers a Government Fund, a Bond Fund, a Stock Fund, a Small Cap Stock fund and an International Stock fund. And they offer ten targets balance funds. So how much more variety do you need? Well, my friend, if you have your heart set on investing in a fund that specializes in electric vehicles or cannabis. Go for it.  But it will cost you. I wanted to simply view the 5,000 available mutual funds. The agreement for the Mutual Fund Window requires me to pay the annual fee to open the account just to view the list of available funds and possibly pay the maintenance fee up front. To stop those fees, you have to permanently close your Mutual Fund Window account.

Let us compare the C Fund versus Vanguard S&P 500 Index. They are basically the same type of investment. However, if you invest 10,000 dollars in another fund you will be paying the following:

An annual fee – $55

An annual maintenance fee – $95

A transaction fee – $28.75

Other fees – I am interpreting these to be front load and redemption fees.

The C fund will cost you a 40 cents per $10,000 of investment. Yes, the Vanguard fund has low expense but that is only if you buy it directly from Vanguard. In the TSP, you have to go through the TSP third party vendor, Mutual Fund Window, who is assisting you with that investment. And that convenience will cost you and decrease your rate of return.

On a $10,000 investment transaction, you would be incurring approximately 2% in fees. If your C Fund investment is earning 10% per year. Your investment in the Vanguard S&P Fund would have to earn 12% to compete with the C Fund. Let’s look at another hypothetical example. You invest in the JP Morgan Research Market Fund; you have a 3.51% front load fee and a defer 1% load fee. To compete with the C Fund earning 10%, you would need to generate a 16.5% rate of return. That includes the TSP fees and the sales fees for the JP Morgan fund that is mentioned. Many of the other available funds may have a load fee so you have to read the fine print before you invest.

As a financial coach, many federal employees contact me regarding their retirement, their TSP and their assets outside of the TSP. As a TSP investor, if I want to purchase another fund for whatever reason, I can still do that through a brokerage account or an IRA. But if you want to do that through the TSP there is a surcharge.

Financial success can easily be achieved; it only takes a little effort.

Nearly Useless Factoid

By Robert O’Shaughnessy

Source: San Francisco Chronicle

Best listening experience is on Chrome, Firefox or Safari. Subscribe to Federal Drive’s daily audio interviews on Apple Podcasts or PodcastOne.

After the Federal Retirement Thrift Investment Board launched a new system for Thrift Savings Plan participants to access their retirement savings, many users expressed frustrations over numerous technical challenges with the update.

Among issues like hours-long hold times for customer service and technical difficulties on the website, a few other common concerns surfaced in a Federal News Network exclusive online survey.

One of the most frequent complaints from TSP users was that they cannot access financial history in the new My Account platform, according to survey respondents.

“I finally got my account created after many calls and anguish. Financial records are still unavailable on TSP website,” one respondent wrote.

We received 1,815 responses, composed of about 67% current federal employees, 30% retired federal employees and 3% former federal employees who are not retired. The results account for a small portion of TSP participants and some numbers may not accurately reflect the actual breakdown of all users’ experience.

Overall, about 55% of respondents said they had issues once they were in the system. And, about 83% of respondents who experienced issues said they couldn’t access their statement history.

As the board initially planned in the transition, historical data, documents and other messages from the old system are not yet available to participants, FRTIB Director of External Affairs Kim Weaver told Federal News Network. That’s because the new recordkeeping system will take multiple weeks to roll out.

The board has all of the information in store and it will soon become accessible to TSP users. Participants will be able to see 10 years of financial history by mid-June.

To request older statements, Weaver said participants should call ThriftLine, the board’s customer service center (contact information is listed on this website).

Customer service challenges

But many participants said they are hesitant to call customer service because of the long hold times and overwhelmed system.

Long waits and some users’ inability to reach a customer service representative were other frequent pain points for survey respondents.

About 30% of respondents who experienced difficulties said they reached out to customer service – and more than 88% of those participants rated the service quality very low, saying they were on hold for multiple hours. Some said their calls dropped or the representatives were not able to offer solutions.

In response, the board added 185 new customer service representatives last week to try to help with the high call volumes. FRTIB plans to add more staff as needed, Weaver said.

But some survey participants said the staff increase was not enough.

“Even with added customer service representatives, calls are still taking hours to be answered, then dropped as one waits that long. After waiting 1.5 hours, I got [in touch with] a representative who placed me in another queue, only to be dropped after waiting three hours,” one respondent wrote.

Weaver added that participants can ask the new virtual assistant for answers to most common questions. The assistant can securely let participants get account information and request certain transactions.

The new assistant presented challenges, too. One participant wrote in an email to Federal News Network that the chat window wasn’t fully functioning and shared a screenshot of an error message.

Account navigation problems

Many survey respondents also said in a free response section that they had difficulty navigating the new system and mobile app. Some said they preferred the old system and didn’t see a need for the update.

“It is not intuitive at all to navigate and important information is buried multiple links deep. The old website was much better because everything was just a click or two away,” one respondent wrote.

“There’s a bit of a learning curve with the new interface. It feels like the dashboard is less informative than before. I have to go to different places for specific information unlike before when it was all laid out in a couple places. While not pretty, it was effective,” another wrote.

Weaver said the website update was necessary to add more layers of security and better protect participants’ personal information.

“Because protecting our participants’ retirement savings is our highest priority, all TSP participant-specific information is behind the My Account login,” Weaver said. “Participants, and the public, can continue to find information regarding TSP fund performance — such as share price history, rates of return, and other data — on the public site at tsp.gov. All information specific to an individual is accessible only after a participant has validated their identity and accessed their My Account.”

Along with enhancing security, the board also developed the new interface with the hope of making a more functional, easy-to-use system.

“Our new My Account interface was built by listening to the pain points employees commonly have accessing traditional applications. Our contractor relied upon research that shows 40% of employees experience symptoms of burnout at work and most frequently use our platform in high anxiety moments. We took that to heart and developed an experience that’s smarter and more empathetic than anything else on the market,” Weaver said.

The board used existing applications like those for consumer banking, mortgage, fitness and well-being to inform the new interface. Additionally, Weaver said the board tested the application with some users before the launch on June 1.

“A 2022 user research study… found most users [who were] tested believed the user interface was less cluttered and easier to access the things they needed compared to traditional portals used for similar purposes.”

But the survey results overwhelmingly showed that many participants were unhappy with the design. For example, several respondents said they were unable to find the annuity calculator in the new system, when it previously was easy to see in My Account.

“The new website is cumbersome and lacks vital information crucial to financial decisions. I cannot find the educational material nor calculators that were previously available,” one respondent wrote.

Difficulties setting up new account

Some survey participants had challenges getting into the system in the first place. About 62% said they experienced difficulties when trying to set up a new login with My Account.

“I’ve had an awful experience trying to repeatedly set up my login. I’m at a loss. May try customer assistance today, but I’m not willing to wait hours to speak with someone,” one respondent wrote.

“I created a new account, but I am unable to log in to it. I have not seen any communication from TSP acknowledging that this is a major issue. I tried to call ThriftLine and waited on hold for more than three hours before I was disconnected,” another wrote.

Despite challenges for some participants, many other survey respondents said they were able to log in and use the platform without any issues. Nearly 90% of TSP participants who have tried to log in have been successful.

“I actually had a good experience. I waited a few days before I went online to set up my new login. I had been using the two-factor authentication with TSP when they initially introduced it a few years ago. The process of having to create another login was fine,” one respondent wrote. “I was a little nervous when they did not associate my phone number with my account, but after selecting a few security questions and providing answers, I was able to complete the process and log in again with my new information without any issues.”

Other respondents said patience was key — they waited several days or more before trying to get into the new account system.

“I knew the new platform would be extremely busy the first few days so I waited until June 9 to register for the new website. No problems at all!” one respondent wrote.

“With any large scale conversion you are bound to have issues — I am waiting to log in until all issues have been resolved,” another wrote.

As many TSP users continue to express frustrations with the system, the board said it is taking complaints into account and working through some of the major issues.

“We will continue to review common My Account navigation questions and feedback to identify future usability enhancements,” Weaver said.

Nothing will change for those who wish to stick to the traditional TSP. It offers a total of 15 funds, including the C, S, I, F and G funds, plus 10 self-adjusting target date funds.

But those who wish to broaden their investment portfolios into more targeted investments, or funds with social or environmental agendas, can do so. For a price: three new fees including a $55 annual access fee, plus a $95 annual service fee, and a per-trade fee of $28.75.

Whether you decide to stay put with your current options, or invest in some of the new ones, it’s critical to understand how the new system works. So here is the official 9-step fact sheet on the new Mutual Fund Window (MFW):

On June 1, 2022, the Federal Retirement Thrift Investment Board launched a mutual fund window (MFW) for Thrift Savings Plan participants.

Highlights:

• The use of the MFW is entirely voluntary. TSP participants will remain invested in the same five core funds and the 10 target date funds that the TSP currently offers unless they choose to invest in a mutual fund through the MFW.
• The MFW offers roughly 5,000 mutual funds in roughly 300 mutual fund families, including those offered by Fidelity, T. Rowe Price, and Vanguard. For funds with multiple classes, the lowest expense ratio class is offered.
• To exercise this option, participants must log into their TSP account and then open an MFW account before they can transfer money from their TSP account through the MFW and select the mutual fund(s) in which they choose to invest.
• All the mutual funds on the platform comply with all applicable U.S. laws and regulations, including those promulgated by the Securities and Exchange Commission (SEC) and the Office of Foreign Assets Control (OFAC). The mutual funds on the TSP MFW platform will follow the same rules applicable to any other mutual fund offered in any other public or private retirement plan in the United States.
• The mutual funds available on the MFW platform have not been reviewed by TSP fiduciaries to determine whether they are wise investments for any individual TSP participant. This means that participants must carefully review the prospectus for each mutual fund and decide which ones will meet their investment goals, as they would if choosing a mutual fund outside the MFW.
• TSP participants who choose to avail themselves of the MFW will be able to use a Morningstar-developed search tool to find mutual funds that meet their specific investment interests. They will be able, and in fact encouraged, to review any mutual fund’s prospectus before investing to have a thorough understanding of the fund’s goals and investments.
• In accordance with the statutory requirement that TSP participants using the MFW bear the cost of the MFW, all TSP participants electing to invest in the MFW would incur additional fees: an administrative fee of $55 annually; an annual maintenance fee of $95; a per trade fee of $28.75; and any fees and expenses imposed by the specific mutual fund(s) in which they invest.
• To be eligible to invest in the MFW, a participant’s minimum initial transfer must be $10,000 and the investments through the window can equal no more than 25% of the participant’s TSP account value.
• The funds that a federal employee or member of the uniform services uses to invest in the TSP or the MFW are personal property, not federal funds. Once a federal employee or member of the uniformed services deposits their paycheck in the bank, it is theirs and not subject to federal control. Money from TSP participants’ paychecks invested in the TSP is exactly the same; it is their personal property and they have property rights under the law.
• Any federal employee or member of the uniformed services can, and has always been able to, invest in any mutual fund outside of their TSP account through any mutual fund provider.

The FRTIB provided some interesting background about the mutual fund window program. If you are interested, find it here.

Nearly Useless Factoid

By Robert O’Shaughnessy

Source: How Stuff Works

The Federal Retirement Thrift Investment Board plans to add even more staff as needed. That’s after a major update to TSP’s system on June 1 caused an influx of calls from participants experiencing difficulties accessing their account data.

Many participants who tried calling ThriftLine, TSP’s customer service office, said they were on hold for a long time, some for more than six hours. On Twitter, one participant shared a phone screenshot of a third call attempt, on the line for multiple hours.

Yesterday 3rd call https://t.co/igz9w8ssh6 pic.twitter.com/saON0xf9N9

— hd (@Hdmizeltotheizl) June 7, 2022

The board tweeted on June 9 that ThriftLine call volumes are “very high.” In response, FRTIB created a “current known issues” landing page to try to help participants resolve a few issues without calling customer service. Common issues include account holds and missing data on both beneficiaries and historical account information. More details about known issues are available when users log in to My Account, the board said.

Overall, 90% of participants who have tried to log in to their account have been successful, but FRTIB Director of External Affairs Kim Weaver said in an email to Federal News Network that right now, the board is focused on helping those who are struggling.

“While most participants are able to successfully navigate the system, our priority right now is resolving the issues and challenges for people having difficulty,” Weaver said. “We are committed to helping those people set up their accounts as soon as possible.”

As part of the June 1 update, the board transitioned to a new recordkeeping system, in charge of maintaining eligibility records, managing payroll data, processing transactions, issuing account statements, providing online access and offering responsive customer support to participants.

The system update requires a one-time setup process that all TSP users must complete.

Many participants reached out to Federal News Network to share concerns about the new system. Some said they cannot log in to their account. Others said once they logged in, there was missing information. Several participants, for example, said once they logged in to the new My Account, they couldn’t access financial information prior to June 1.

“The new login system has bugs, it does not recognize existing personal info, it freezes up all the time, it constantly changes required inputs and it does not allow access to existing accounts … All historical data is gone,” one participant wrote in an email to Federal News Network.

The recordkeeper transition requires moving a large amount of data and transferring account information for about 6.5 million TSP participants. Weaver said participants now have access to year-to-date employee contributions for 2022.

But some information is not yet available for participants to see in their accounts. The board is on track for its plan to make 10 years of prior year-ending account balances available online in mid-June.

“Historical statements, documents and other messages from the prior system have not been transferred to the new My Account. If participants need access to historical documents, they will need to request them by calling ThriftLine,” Weaver said (this website has contact information for TSP customer service).

Aside from historical data, some participants said their beneficiary information was inaccurate in the interface.

Weaver said “for a small number of participants,” the board didn’t transfer beneficiary information to the new system because it didn’t meet data quality standards. The board encourages all participants to review and confirm their beneficiary information.

Weaver said the missing data is only a perception on the user end – the board has all the correct information in store.

“Rest assured that we still have their previous beneficiary designations and they will be followed should it be necessary,” she said.

Some participants also said they are unable to get loans processed because of missing or inaccurate information. One participant who wants to take out a loan expressed frustrations about trying to get in touch with customer service.

“The TSP help line personnel have all been great, but the first line of help can’t do much, and can only transfer you to the loan department or their next line supervisor… we’ve had several dropped calls, which is demoralizing after hours on hold,” the TSP user wrote in an email to Federal News Network. “As it stands, the system thinks our accounts are new, so it says we can only borrow a little over half of what we’re actually allowed to borrow…we cannot get in touch with anyone in loan processing.”

Weaver said the board is aware that the issues are causing confusion and frustration. But on the back end, all data is accurate.

“Our financial and loan conversions balanced to the penny,” Weaver said. “We are continuing to monitor potential issues and are working to address them as rapidly as possible. We will be publishing additional information regarding known issues to tsp.gov and in My Account.”

For some users, certain internet browsers seem to work better than others to load the website. Participants shared online that Microsoft Edge seems to be the best browser to use, while Google Chrome and Safari don’t work as well.

“This seems to be an intermittent issue and one we have not been able to replicate at-scale in our environment. While we are continuing to troubleshoot, we’ve been advising participants to try a different browser. Our team is investigating what may be causing this issue,” Weaver said.

The goal of the new My Account interface and recordkeeper transition is to ensure the safety of participants’ investments by adding more layers of security, as well as anti-fraud protections. But Weaver said the board understands that the changes have caused challenges for some participants trying to set up accounts.

“We understand our participants’ frustration and apologize for the inconvenience. We’re working to address issues as rapidly as possible, and we appreciate their patience,” she said.

In the meantime, the board is continuing normal processes, enrollments and transactions.

“Our financial management systems are up and running. Contributions are being processed. Loans, withdrawals and mutual fund window enrollments are happening. TSP savings remain invested in the funds participants have chosen. More than 1,100 participants have rolled money into the TSP. More than 12,000 withdrawals requests have been received,” Weaver said.

Some of the fearful can avoid some of the changes. In other cases there is no escape, if escape is what they’d like!

The June 1 rollout of the TSP’s new My Account system requires all participants to set up a new login system for their personal account. No good saying “the old system is fine.” This is one of those everybody-in-the-pool deals. It is part of the massive changeover that will give investors — civilian and military — the option to put some of their current and future retirement nest egg in any of 5,000 new funds. For many it’s about time. They hope to make a lot more money and maybe support certain causes with their 401k money. For others it’s a nightmare. Both the rollout itself and what, to them, is a bewildering array of choices.

Lots of folks having trouble with the new system contacted Federal News Network to share their stories.

One 70-something who has been a TSP investor since day one said, “I too had lots of trouble,” until he asked his more tech savvy wife to check it out. “She had it down in less than 2 minutes,” he said. So there is hope, right? Might even turn out to be better. This is no consolation to the don’t-fix-it-if-it-ain’t-broke community. Of which I am a card-carrying member. But it is happening. And the folks in charge are not only very competent, they are also in the same boat as you. Which is more than many private sector workers can say about their 401(k) plan, with its oversight, low fees and matching contributions.

Nearly Useless Factoid

By Daisy Thornton

The total biomass of all the ants on Earth outweighs that of the total population of humans nearly by a factor of 10.

Source: NPR

The good news for the nation’s biggest bloc of investors — active and retired federal/military people — is that they’ll soon have 5,000 new funds to choose from. That’s in addition to the 15 basic choices they have now. They cover the U.S. stock market (C and S funds), part of the international stock market (I fund), bonds (F fund) and guaranteed U.S. Treasury securities (G fund). There are also 10 self-adjusting target date funds. That’s in keeping with the congressional mandate when the TSP was setup: Keep it simple, keep it low cost! After all, members of Congress, staff, federal judges and others are in the federal 401(k) plan too!

The 5,000 new choices will include funds with social goals, real estate and other special interests. Many of them may be close to your heart. The question is will they also make money and build your retirement nest egg? It might have to last 20, 30 or 40 years of inflation and other upheavals. Check out the new choices.

Retirement benefits for career feds and military personnel will be based on their length of service and salary. Unlike the vast majority of private pension plans, the federal-military programs are protected from inflation. Benefits will come from three sources: The federal/military annuity or retired pay, Social Security and the TSP. Which makes it so important to everybody. The TSP could supply one-third or more of the spending money retirees will have.

So far, so good! But every top has a bottom, right?

The bad news for that same federal-military investment group now on more or less automatic pilot is that they soon will have all those new choices and fund options. That will make frequent trading easier. And more confusing. And definitely more expensive. How would you handle 5,000 new TV channels? Frequent traders will have more chances to zig when they should have zagged. And to read (or time) the market incorrectly. Knowing when to buy low and sell high. Most investors know the concept. Few have actually made it pay off.

Arthur Stein, a D.C.-area financial planner, has been tracking the TSP for clients for decades. And several of his clients are self-made TSP millionaires. He urges people to invest for the long haul. And avoid what he believes is risky behavior: when clients have too much of their retirement nest egg in the G fund. Which is what we’ll talk about today when he’s my guest on our Your Turn show at 10 a.m. EDT. You can listen live at federalnewsnetwork.com or 1500 AM (in the Washington-Baltimore area) or listen later. Because of all the TSP changes this is one you don’t want to miss. If you have questions for him you want answered on air, send them to me before show time at mcausey@federalnewsnetwork.com.

Nearly Useless Factoid

By Daisy Thornton

The pop-up toaster was patented in 1921, nine years before Wonder Bread introduced sliced loaves.

Source: Overstock.com

We want to hear about your experience with setting up a new account, accessing TSP’s new features and contacting customer service. Please take a few minutes to fill out this survey. All answers are anonymous. We will publish the results soon.

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Some Thrift Savings Plan participants are experiencing major service delays when trying to access their retirement accounts.

The new version of My Account, launched on June 1, requires all participants to set up a new login. As a result, the Federal Retirement Thrift Investment Board, the agency in charge of the TSP, received an influx of customer service calls over the past several days.

After the board rolled out a mobile app and a new online interface, several readers reached out to Federal News Network to share their firsthand experiences and express frustrations.

“No one has account access. No phones are or emails answered. FRTIB no longer responds,” one participant wrote in an email.

“I have been unsuccessful at logging into my account for the past five days. Using the TSP website and their login instructions I have attempted to set up my new TSP credentials at least seven times,” another participant wrote to Federal News Network. “On two separate days I attempted to contact TSP on their customer service phone number … I was on hold for six hours.”

The board acknowledged the delays, saying a higher volume of participants calling was expected.

“We have seen record-breaking call volumes, leading to increased hold times. We received more than 120,000 phone calls on June 1 – two-point-five times more than our previous high call volume,” FRTIB Director of External Affairs Kim Weaver wrote in an email to Federal News Network.

The board is “urgently working” to address the delays, Weaver said.

“We are very sorry for frustration and delay some participants are experiencing,” Weaver wrote.

Take our survey on your experience with the update here.

Many TSP participants also posted on a Reddit forum to share their frustrations with the new My Account system.

“For those of you that can’t create your new TSP account name, do not bother trying to call for help. I was on hold for four and a half hours only to be told it is a known issue they are working on and to try again,” one user wrote.

Many users also said that the internet browser that participants use may affect their ability to log in. Currently, the best one to use is Microsoft Edge, according to many Reddit users.

Weaver said the board is aware of the internet browser issues and is working to address them.

In response to the service issues, some said the board shouldn’t have updated the system at all.

“We got rid of a system that worked and replaced it with a new one that doesn’t work as well. And when it does work, it provides a fraction of what the old one offered,” one Reddit user wrote.

But Weaver said the new login is necessary because the board’s highest priority is protecting participants’ retirement savings.

“We designed this process with security and anti-fraud measures in mind,” she wrote.

Weaver said to access the new My Account, participants must complete the required one-time setup process either through an online enrollment process or a one-time passcode sent to them through the mail.

As of June 5, roughly 86% of participants who have attempted to set up their new login have completed online identity verification for immediate access to their online account. Additionally, about 3% of participants have had a one-time passcode mailed to them, Weaver said.

Weaver added that there is help available for participants who are having difficulties. ThriftLine participant services representatives can help users request a one-time mailed passcode or guide them through the online account setup process.

Despite the issues and delays, Weaver said core functionality of the system is working well.

“We are processing payroll contributions and running all daily processes, including loans, withdrawals, fund reallocations, beneficiary designations and mutual fund window enrollments,” Weaver wrote.

Compared to a year ago, all funds posted lower returns except the government securities investment G fund and the fixed income index investment F fund, according to monthly returns released by the TSP on Wednesday. The G fund, which had a return of 0.13% for May 2021, had a 0.21% return last month; while the F fund had a 0.34% return for May 2021 and a 1.13% return last month.

The G fund continued its streak of modest, yet consistent month-over-month growth that has been happening for at least 57 months, based on Federal News Network data.

The small cap stock index S fund had the lowest return, at -3.53% last month. Compared to April, it is up from -10.57%. The common stock index C fund rose from a -8.72% return in April, to a -1.65% return in May. Meanwhile, the fixed income index F fund is the only fund aside from the G fund that gained ground over the last year.

All Lifecycle funds finished in the red last month except for the L Income fund, which had a return of 0.04%. The biggest monthly gains were in the L 2055, L 2060 and L 2065 funds, which rose from  -8.11% in April to -0.89% last month.

Year over year, all Lifecycle funds were down in May.

Differences between fund and index returns were larger than normal last month because the TSP transitioned its record keeper, said Kim Weaver, the director of external affairs for the Federal Retirement Thrift Investment Board. As a consequence of the switch, participants were unable to make trades on May 27 and May 31. The returns presented reflect the market returns through May 26. Benchmark indices captured the entire month, however.

A million dollar nest egg may be a reasonable goal at age 25. But that could change by the time you are 50 or 60. Maybe been through a major recession or two. Or seen inflation skyrocket. Like, well, now. Nobody is getting any younger.  But the world and the economy — from gasoline and infant formula to the threat of an expanding war in Europe — are changing daily. So far, in many cases, not for the better. So we asked a recently retired fed, Abraham Grungold, for his thoughts. He recently left government after a long-career and long-time TSP investor who became a millionaire plus by careful and steady investing. Here’s what he said:

TSP — How much is enough?

There are approximately four million federal employees in the Thrift Savings Plan (TSP) and there are over 100k TSP millionaires. So how much TSP savings are enough for a successful retirement? What is the amount needed for someone to retire comfortably? It depends on many factors which are different for every individual’s personal and financial needs. The figures in the following two scenarios are estimates and federal and state taxes may vary.

Single Person

After 30 years of federal service and at age 62 years of age you have a 30,000 annuity, a 20,000 SSA benefit, and you have 500,000 in your TSP withdrawing 4% for the next 25 years which is 20,000 per year. Your total is 70,000 per year and after taxes it comes to approximately 55,000 per year. Will this level of income satisfy his/her lifestyle?

Married Couple

Let’s apply the scenario to a married couple both are at age 62 with one spouse being a federal employee. And they have $1 million in their TSP and combined retirement savings.

Spouse #1 has a $30,000 annuity, $20,000 SSA and spouse #2 has a $20,000 SSA. They are withdrawing 4% of their $1,000,000 over 25 years which is $40,000 per year. Their total is $110,000 per year and after taxes it comes to approximately $85,000 per year. Will this level of income satisfy your lifestyle?

Prior to retirement, it is very important for federal employees to maximize their contributions and invest aggressively in order to achieve the level of retirement income that they desire as well as to consider a plan for the unforeseen life events. I have heard from several federal employees that $2 million is enough for them in retirement. But, is it really enough?

Life can throw you some curve balls.  Here are a few of unplanned events that can pop up in retirement:

1. Inflation and the rising cost of everything.
2. Mortgage for a second home/vacation home.
3. Medical and pharmaceutical needs.
4. Grandchildren’s college education.
5. Long term care/nursing home.

In retirement, you need to take a conservative approach and to monitor your expenses very closely.  TSP investors still need to invest somewhat aggressively in order to plan for these unforeseen events and to continue building their TSP even though they are making withdrawals.

As a financial coach, many federal employees contact me regarding their retirement, their TSP and their assets outside of the TSP.  I suggest that they need to have a contingency plan in retirement to address any possible situations.  Saving as much as possible in your TSP is the solution to these senior life events.

Nearly Useless Factoid

By Robert O’Shaughnessy

It takes 90 days for a drop of water to travel the entire length of the Mississippi River.

Source: National Wildlife Federation