-
Welcome to the TSP Talk Forums forums.
You are currently viewing our boards as a guest which gives you limited access to view most discussions and access our other features. By joining our free community you will have access to post topics, communicate privately with other members (PM), respond to polls, upload content, join our AutoTracker, and access many other special features. Registration is simple and absolutely free so please, join our community today!
If you have any problems with the registration process or your account login, please contact us. -
The Forum works well on MOBILE devices without an app: Just go to: https://forum.tsptalk.com
-
Please read our AutoTracker policy on the IFT deadline and remaining active. Thanks!
-
$ - Premium Service Content (Info) | AutoTracker Monthly Winners | Is Gmail et al, Blocking Our emails?
Find us on: Facebook & X | Posting Copyrighted Material
-
Join the TSP Talk AutoTracker: How to Get Started | Login | Main AutoTracker Page
What YOU can do to fight back - IFT limit
- Thread starter James48843
- Start date
James48843
Well-known member
Bumping this up to the top--
It appears that the letters being sent out are causing a number of people to find us here at TSPTALK. People who are getting the letters, but have only just this week found us here.
Good.
If you are just joining us for the first time, please feel free to register, and discuss the battle which lies ahead of us. Start by reading this thread from the beginning- as we are talking about a number of strategies to fight back.
Thanks in advance, and welcome aboard.
It appears that the letters being sent out are causing a number of people to find us here at TSPTALK. People who are getting the letters, but have only just this week found us here.
Good.
If you are just joining us for the first time, please feel free to register, and discuss the battle which lies ahead of us. Start by reading this thread from the beginning- as we are talking about a number of strategies to fight back.
Thanks in advance, and welcome aboard.
James48843
Well-known member
The claim is wrong. They are saying that frequent trading creates an increased "risk" that the funds won't reach the benchmark index. As shown in an eariler TSPSHAREHOLDER.ORG newsletter, the funds have EXCEEDED the benchmark indexes- BECAUSE of increased interfund transfer activity.
That is what they (ETAC and BOARD) don't understand.
Interfund transfers HELP the funds, not hurt them.
Gaetaone
Member
Could it be there's another direction that this can be fought? I'm not active duty nor retired but seems to me this targets the great men and women of our armed forces who go in harms way. Couldn't be very popular these days to be taking away a benefit from those who have or will be deployed... Election year...... I'll draft a letter and send it out to a few members of the HASC..
If I missed this approach in a previous thread... ooops
John
If I missed this approach in a previous thread... ooops
John
TSP Badboy Letter said:
Ya I just got my letter.
Just what does the above sentence mean? Can this claim be substantiated? They make it sound like we are children who need to be protected from ourselves. (BTW I made 17% last year actively managing my money versus their stupid dumb downed L funds).
I got my letter from Mr. Long yesterday as well. I'm not changing what I'm doing. They can try to limit me through the court system, and if I win, I'll fund a new IRA with the monies.
Jimmy
Good thinking Jimmy. I don't know why we just don't start collecting money for a class action law suit. I'll throw in the first $500.00. Long and his staff have been negligent in their duties. The proper way to have handled all of this was to educate the customers, explain the problem and ask for help. They could have put banners on the web site directing attention to the issue since the frequesnt IFT folks have to go to the web site anyway. I believe most employees would have cut back. I for one did not know it was an issue. Instead they have alienenated a lot of people and will eventually get sued and will eventually have stricter oversight.
In view of the sub prime mess, the Soc. Gen. bank scandal, etc, I am now writing letters (again) to the Secretary of Labor and the Chairman of the House and Senate Government Affairs Committees to have regular annual and continuous oversight of this important program. Right now there is no scheduled oversight. That needs to change. They want strict rules, so let's have Congrees and DOL checking on them and giving them proper adult supervision. :cheesy:
Jimmy
Good thinking Jimmy. I don't know why we just don't start collecting money for a class action law suit. I'll throw in the first $500.00. Long and his staff have been negligent in their duties. The proper way to have handled all of this was to educate the customers, explain the problem and ask for help. They could have put banners on the web site directing attention to the issue since the frequesnt IFT folks have to go to the web site anyway. I believe most employees would have cut back. I for one did not know it was an issue. Instead they have alienenated a lot of people and will eventually get sued and will eventually have stricter oversight.
In view of the sub prime mess, the Soc. Gen. bank scandal, etc, I am now writing letters (again) to the Secretary of Labor and the Chairman of the House and Senate Government Affairs Committees to have regular annual and continuous oversight of this important program. Right now there is no scheduled oversight. That needs to change. They want strict rules, so let's have Congrees and DOL checking on them and giving them proper adult supervision. :cheesy:
Thank you for contacting me regarding a regulation proposed by the Federal Retirement Thrift Investment Board (FRTIB). I appreciate hearing from you on this matter.
As you know, the FRTIB has issued a proposal that would allow Thrift Savings Plan (TSP) participants to make no more than two interfund transfers per month. Under this regulation, participants would still be allowed to transfer money to the G Fund at any point, even if they have reached their maximum amount of interfund transfers. The FRTIB has stated that the increased number of excessive interfund transfers by a small number of TSP participants has caused a “detrimental effect on fund performance and transaction costs.”
According to the FRTIB, the process of establishing this regulation will include a public rule-making under the Administrative Procedures Act. The regulation will be published in the Federal Register and will be open for public comment.
If you have not already done so, I encourage you to send your comments to the FRTIB on this issue. You may send your comments to the following address:
Federal Retirement Thrift Investment
Board, 1250 H Street, NW., Washington,
DC 20005.
Again, thank you for sharing your thoughts with me. Please feel free to contact me if I may be of further assistance.
Sincerely,
Carl Levin
As you know, the FRTIB has issued a proposal that would allow Thrift Savings Plan (TSP) participants to make no more than two interfund transfers per month. Under this regulation, participants would still be allowed to transfer money to the G Fund at any point, even if they have reached their maximum amount of interfund transfers. The FRTIB has stated that the increased number of excessive interfund transfers by a small number of TSP participants has caused a “detrimental effect on fund performance and transaction costs.”
According to the FRTIB, the process of establishing this regulation will include a public rule-making under the Administrative Procedures Act. The regulation will be published in the Federal Register and will be open for public comment.
If you have not already done so, I encourage you to send your comments to the FRTIB on this issue. You may send your comments to the following address:
Federal Retirement Thrift Investment
Board, 1250 H Street, NW., Washington,
DC 20005.
Again, thank you for sharing your thoughts with me. Please feel free to contact me if I may be of further assistance.
Sincerely,
Carl Levin
Silverbird
Well-known member
http://www.frtib.gov/pdf/FOIA/TSP-Regs_IFT-Dec2007.pdf
Fed register notice on Frequent trade
Federal Register
"....The Agency desires to stop this excessive trading immediately and also, after continued analysis, to design an interfund transfer policy that provides for administrative efficiency, investment flexibility, retirement security, as well as reduced trading costs. To that end, in the near term, the Agency is adopting a regulation to grant the Executive Director the authority to notify the small percentage of participants who are driving up costs through their excessive trading and request that they cease their practicesOtherwise, these participants will be required to request interfund transfersby mail. It is the Agency’s hope that thisswift and direct action will inform suchparticipants of the unreasonable expenses associated with their trading and persuade them to voluntarily curbtheir trading, thereby curtailing the excessive trading costs borne by all participants who hold the C, F, S, I, and L Funds
Further, upon continued inquiry including an analysis of the actions that can be taken on an automated basis, the Agency likely will amend its regulations (via a separate publication in the Federal Register to permit two interfund transfers per calendar month with subsequent unlimited interfund transfers only into the G Fund. The[/font Agency believes this policy, when compared to others adopted in the private sector, provides the desired level of administrative simplicity, investment flexibility and security, and control over excessive trading.
Fed register notice on Frequent trade
Federal Register
Vol. 72, No. 247
Thursday, December 27, 2007
FEDERAL RETIREMENT THRIFT
INVESTMENT BOARD
5 CFR Part 1601
Participants’ Choices of TSP FundsINVESTMENT BOARD
5 CFR Part 1601
"....The Agency desires to stop this excessive trading immediately and also, after continued analysis, to design an interfund transfer policy that provides for administrative efficiency, investment flexibility, retirement security, as well as reduced trading costs. To that end, in the near term, the Agency is adopting a regulation to grant the Executive Director the authority to notify the small percentage of participants who are driving up costs through their excessive trading and request that they cease their practicesOtherwise, these participants will be required to request interfund transfersby mail. It is the Agency’s hope that thisswift and direct action will inform suchparticipants of the unreasonable expenses associated with their trading and persuade them to voluntarily curbtheir trading, thereby curtailing the excessive trading costs borne by all participants who hold the C, F, S, I, and L Funds
Further, upon continued inquiry including an analysis of the actions that can be taken on an automated basis, the Agency likely will amend its regulations (via a separate publication in the Federal Register to permit two interfund transfers per calendar month with subsequent unlimited interfund transfers only into the G Fund. The[/font Agency believes this policy, when compared to others adopted in the private sector, provides the desired level of administrative simplicity, investment flexibility and security, and control over excessive trading.
Last edited by a moderator:
qibovin
Member
That's the problem with their "plan." It appears to be too vague to enforce. You won't find out in February, because you probably won't know if your activity was "acceptable" until they put you on snail mail (or not) in March (or whenever they get around to it).
I would like to suggest that if anybody does get snail slimed, they start sending in daily IFTs (whether they were IFTing that frequently before or not) just to show them how assinine a plan this is. Just move 1% back and forth between the I and F since those are the most costly supposedly. Remember, they can't actually limit the number of IFTs (until further steps are taken).
jeburnside
New member
I got my letter from Mr. Long yesterday as well. I'm not changing what I'm doing. They can try to limit me through the court system, and if I win, I'll fund a new IRA with the monies.
Jimmy
Jimmy
Where did the three Interfund Transfer per month idea in Mr. Long's letter come from? I thought it was going to be 2 unconditional Interfund Transfers per month, then unlimited Interfund Transfers to the G fund only. Does anyone know if I still get unlimited Interfund Transfers to the G fund after I use up my 3 unconditional Interfund Transfers? Guess I'll find out in February!
Intrepid_Timer
Well-known member
Hitting your boss might work. 
Dear Frequent Trader:
As explained below, you have been identified as a frequent trader in the Thrift Savings Plan. Unless you reduce your trading activity to no more than 3 interfund transfers per month, we may require you to request interfund transfers by mail only.
Since the Thrift Savings Plan introduced daily valuation of participant accounts in 2003, it has not restricted the number or frequenct of participant-iniated interfund transfers. However, recently, the frequent trading activity of a small number of participants is resulting in higher transaction costs and reduced return for all participants in the affected TSP Funds - including long term investors who do not generate these costs. Frequent trading is also creating greater risk of performance deviation from the TSP Funds benchmark indexes.
By law, the Federal Retirement Thrift Investment Board (which administers the TSP) is required to develop investment policies which replicate the performance of the indexes selected for investment and provide for low expenses. Because frequent IFT activity diminishes the achievement of these goals, the Board is addressing the problem in two ways - (1) Structural changes to the TSP system to implement restrictions on the number of interfund transfers that can be executed per calandar month, and (2) intermin measures designed to lower trade volume in the meantime.
In November 2007, the Board approved a policy initiative that would permit two IFTs per calander month, with subsequent unlimited IFTs into the Government Securities Investment Fund. When compared to the more restrictive limits adopted by private sector defined contribution plans, record keepers, and/or investment fund managersm, this approach provides investment flexibility, administrative simplicity, and control over excessive trading.
Further, based on current behavior, approximately 99% of participants will not be affected by the proposed restrictions. We will soon publish proposed implementing regulations for public comment. The Federal Register notice will include a description of the problem, the restrictions established by other funds/plans, and our proposed solution. We will consider comments as we move towards resolution o this matter in the Spring of 2008. We are also notifying all participants of the proposed changes when we send the annual TSP participant statements in February, 2008.
Our immediate concern, however, and the reason for this letter to you, is the reduction of trading activity among those participants who trade most frequently. Based on the authority granted to the Executive Director to take appropriate action to restrict frequent interfund transfers, we are contacting those participants who have made frequent IFTs and asking them to voluntarily change their investment strategies.
Because in October, Novermber and December 2007, you made more than three IFTs each month, you fall within this frequent trading group. Therfore, unless you reduce your IFTs to no more than three per month (starting in February) we may notify you that you will be required to request your IFTs by mail until the permanent restrictions have been implemented. This proceedure is authorized by Federal Regulation 72 Fed, Reg. 73,251 (Dec 27, 2007) (to be codified at 5CFR 1601.32). We are asking for your cooperation in this matter.
We have posted a set of Questions and Answers about the frequent trading activity, as well as the November 6, 2007 memorandum to the Board, and it's accompanying presentation, under "Information about Interfund Transfer Restrictions" on the TSP Web site's Home page (www.tsp.gov). Links to the regulation cited above can be found at www.frtib.gov and www.tsp.gov ("What's New" or "Information about the Interfund Transfer Restrictions"). We will also post a link to the proposed regulations regarding the structural restrictions when that issuance is published in the Federal Register.
We strongly encourage you to read these materials so you understand the impact of your frequent trading activities and the reason we are taking these actions. If you have any questions regarding this letter, you may contact the TSP at 202-942-1460.
Sincerly,
Gregory T. Long
Executive Director
As explained below, you have been identified as a frequent trader in the Thrift Savings Plan. Unless you reduce your trading activity to no more than 3 interfund transfers per month, we may require you to request interfund transfers by mail only.
Since the Thrift Savings Plan introduced daily valuation of participant accounts in 2003, it has not restricted the number or frequenct of participant-iniated interfund transfers. However, recently, the frequent trading activity of a small number of participants is resulting in higher transaction costs and reduced return for all participants in the affected TSP Funds - including long term investors who do not generate these costs. Frequent trading is also creating greater risk of performance deviation from the TSP Funds benchmark indexes.
By law, the Federal Retirement Thrift Investment Board (which administers the TSP) is required to develop investment policies which replicate the performance of the indexes selected for investment and provide for low expenses. Because frequent IFT activity diminishes the achievement of these goals, the Board is addressing the problem in two ways - (1) Structural changes to the TSP system to implement restrictions on the number of interfund transfers that can be executed per calandar month, and (2) intermin measures designed to lower trade volume in the meantime.
In November 2007, the Board approved a policy initiative that would permit two IFTs per calander month, with subsequent unlimited IFTs into the Government Securities Investment Fund. When compared to the more restrictive limits adopted by private sector defined contribution plans, record keepers, and/or investment fund managersm, this approach provides investment flexibility, administrative simplicity, and control over excessive trading.
Further, based on current behavior, approximately 99% of participants will not be affected by the proposed restrictions. We will soon publish proposed implementing regulations for public comment. The Federal Register notice will include a description of the problem, the restrictions established by other funds/plans, and our proposed solution. We will consider comments as we move towards resolution o this matter in the Spring of 2008. We are also notifying all participants of the proposed changes when we send the annual TSP participant statements in February, 2008.
Our immediate concern, however, and the reason for this letter to you, is the reduction of trading activity among those participants who trade most frequently. Based on the authority granted to the Executive Director to take appropriate action to restrict frequent interfund transfers, we are contacting those participants who have made frequent IFTs and asking them to voluntarily change their investment strategies.
Because in October, Novermber and December 2007, you made more than three IFTs each month, you fall within this frequent trading group. Therfore, unless you reduce your IFTs to no more than three per month (starting in February) we may notify you that you will be required to request your IFTs by mail until the permanent restrictions have been implemented. This proceedure is authorized by Federal Regulation 72 Fed, Reg. 73,251 (Dec 27, 2007) (to be codified at 5CFR 1601.32). We are asking for your cooperation in this matter.
We have posted a set of Questions and Answers about the frequent trading activity, as well as the November 6, 2007 memorandum to the Board, and it's accompanying presentation, under "Information about Interfund Transfer Restrictions" on the TSP Web site's Home page (www.tsp.gov). Links to the regulation cited above can be found at www.frtib.gov and www.tsp.gov ("What's New" or "Information about the Interfund Transfer Restrictions"). We will also post a link to the proposed regulations regarding the structural restrictions when that issuance is published in the Federal Register.
We strongly encourage you to read these materials so you understand the impact of your frequent trading activities and the reason we are taking these actions. If you have any questions regarding this letter, you may contact the TSP at 202-942-1460.
Sincerly,
Gregory T. Long
Executive Director
"Staff Told to Protect Thrift Savings Plan's Assets"
http://www.washingtonpost.com/wp-dyn/content/article/2008/01/22/AR2008012203066_pf.html
Are they talking about costs our OUR ASSESTS?
http://www.washingtonpost.com/wp-dyn/content/article/2008/01/22/AR2008012203066_pf.html
Are they talking about costs our OUR ASSESTS?
oreo
Member
I was just thinking today that if there was ever a good week to write a protest letter or email to your elected representative, it would be this week.
The congresspeople as well as their staff all have tsp accounts and if ever the impact of limiting the accounts would felt in their own wallets, it would be now. Maybe this downturn will remind them to look at their own accounts and realize that this is important and do something.
JMHO.
The congresspeople as well as their staff all have tsp accounts and if ever the impact of limiting the accounts would felt in their own wallets, it would be now. Maybe this downturn will remind them to look at their own accounts and realize that this is important and do something.
JMHO.
JonesH2O
New member
Just read the following on http://finance.groups.yahoo.com/group/TSP_Strategy/message/7806. Looks like TSPKey has given up and is going along with the other sheep . . .
TSPKey's Plan for the New Restrictions on Allocations In November 2007,
the TSP went public with a plan to restrict interfund transfers (IFTs).
The new policy only allows two IFTs per month. Once two IFTs are made,
participants are only allowed to transfer into the G Fund. In response,
we've introduced three systems <http://www.tspkey.com/NewSystems.html>
that comply with the upcoming restrictions.
The policy is tentatively scheduled to begin in March or April 2008.
Before then, "frequent traders" may receive a letter requesting that
they reduce IFTs. If they don't comply, they'll be forced to "snail
mail" IFTs.
While we don't support the new restrictions, the move doesn't surprise
us. As TSP administrators have noted, similar--and more
restrictive--limitations are common for private sector retirement plans.
Those who manage such plans believe cost effectiveness is a primary
fiduciary responsibility. Limiting transactions helps them achieve this
goal. In addition, most plan administrators subscribe to the
"buy-and-hold" theory of investing, and think frequent or flexible
trading privileges are harmful to most participants.
TSPKey's Plan for the New Restrictions on Allocations In November 2007,
the TSP went public with a plan to restrict interfund transfers (IFTs).
The new policy only allows two IFTs per month. Once two IFTs are made,
participants are only allowed to transfer into the G Fund. In response,
we've introduced three systems <http://www.tspkey.com/NewSystems.html>
that comply with the upcoming restrictions.
The policy is tentatively scheduled to begin in March or April 2008.
Before then, "frequent traders" may receive a letter requesting that
they reduce IFTs. If they don't comply, they'll be forced to "snail
mail" IFTs.
While we don't support the new restrictions, the move doesn't surprise
us. As TSP administrators have noted, similar--and more
restrictive--limitations are common for private sector retirement plans.
Those who manage such plans believe cost effectiveness is a primary
fiduciary responsibility. Limiting transactions helps them achieve this
goal. In addition, most plan administrators subscribe to the
"buy-and-hold" theory of investing, and think frequent or flexible
trading privileges are harmful to most participants.
12%ayear
Well-known member
sorry if this was posted already.. http://www.planadviser.com/education/article.php/1655
