More Services, Higher Budgets Projected at Federal TSP Program

[Bullitt]

I would be surprised if this is just a temporary increase. Imagine getting a 23.4% pay raise. Wonder how this will affect our fees.

The FRTIB does not receive any appropriated funds; all funds to run the Agency and the TSP come from administrative expenses levied on TSP participants.

The proposed TSP budget for fiscal year 2021 will jump to $498.4 million for the current budget of $385.6 million—about a 29% increase. This would also increase the budget to participant ratio to $79 from the current $64 participant level—an increase of 23.4%.

As much of the increase would be due to the cost of implementing a new record-keeping system, and running two systems during the implementation of the new system, the large budget increase would be temporary, according to the budget projections from the TSP.

This might satisfy those who are unhappy about current asset choices.

A mutual-fund window has been discussed by the TSP and by at least some TSP investors for some time. When fully implemented, this window will be designed to allow TSP participants to invest in mutual funds offered on the platform used by the winning RKSA vendor. These mutual funds will be different from the 5 core TSP Funds that are now available to TSP investors.

https://www.fedsmith.com/2020/09/16/more-services-higher-budgets-projected-federal-tsp-program/

 

[James48843]

I would like to note, for the record, that the TSP’s entire budget, before they restricted monthly interfund transfers, was on the order of $43 million dollars per year, and that was back when they were able to develop the entire daily valuation system out of that budget.

The costs per $1,000 invested have gone up significantly since they restricted trades to two per month.


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[bmneveu]

The costs per $1,000 invested have gone up significantly since they restricted trades to two per month.

Yes I remember just 10 years ago it was in the 25 cent range. Now we are averaging 42 cents. I wonder if that is because they added the L funds?

 

[Bullitt]

All the while major fund companies have found ways to continually lower costs to zero or near zero. Yes, those fees are passed on in other ways such as bid/ask, specialized higher fee funds, lifecycle funds and managed accounts, but I'd imagine the assets under management in TSP is among the highest in the business.

TSP is still very low, but I don't feel like I'm getting much value for the increased fees.

Network security? Come on, give me a break. 2FA is used on sites that don't even have advertising revenue and probably should have been enforced 5 years ago. The masking of the username provides zero security and is a waste. The website hasn't changed much at all in the past 10 years in terms of what it offers.