contribution allocation vs interfund transfer

[Trish]

imported post

Would someone please explain the difference?.. I know IFT is pretty much now and contribution allocation effects futures but what's the difference in the two as to what they affect?.. the couple of times I've done this, I do both at once. In other words, I see know difference in the two.

 

[Shaggy]

imported post

Allocation is the percentage of your paycheck allocation that is going into each account ie. S fund C fund etc. Inter Fund Transfer is the percentage in each fund from your total TSP. If you have $30,000 and you have 100% of your TSP in the G Fund and you do a IFT of 10%-G, 50%-C, and 40%-S, then it sells 90% of the G Fund and purchases the other funds. IFT is the actual buying and selling of the funds. Allocation is the % of the total amount you contribut to TSP per paycheck that is going to each fund. This does not change the % of your check that is going to TSP all together however. Confused yet. Hope that helped.

 

[Trish]

imported post

Shaggy..thanks.. yes that makes sense.