What YOU can do to fight back - IFT limit

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I agree with James that phone calls to as many ETAC members as possible are most effective, but if you can't or won't call, AT LEAST e-mail the chairman (James Sauber) and the vice-chairman (Richard Brown) of ETAC and let them know how you feel!!. It is CRITICAL that these gentlemen hear from us! Ask them to reply to your e-mail and let you know whether they will help fight these outrageous restrictions on our rights or not....and if not, why not??. And if you don't hear back from them within a few days, e-mail them again! Everyone can do this, it just takes a few minutes.

There are many sample letters and other good posts in this thread that can be plagerized for the content of your e-mails, if that saves time for you.

Richard Brown, President, NFFE
RBrown@NFFE.org

James Sauber, Research Director, NALC
JSauber@NALC.org
 
You All Miss The Point

As much as I do not like this policy change, I fully agree with it. We can't have it both ways. TSP has by far the lowest fees of any 401k! 6 bp is an amazingly low fund fee. Most TSP funds fees are less than half of even Vanguard, and Vanguard is quite strict concerning trading activity. You can't expect to have a fund fee of 6 basis points, and allow unlimited trading. Each of you look at your account balance, mutiple it by 6bp, and see how little in fees you are charged. TSP must either increase fees or decrease costs (curb the trading activity). Like it or not, the vast majority of TSP investors do not actively trade their accounts, and only periodically reallocate. And any poll in this regard will be biased, as those who don't trade have little incentive to participate in the poll. Why should they be required to pay higher fees to subsidize our activity? Therefore, the only answer that makes sense to me is for TSP to institute a "pay to play". If you want to actively trade, you must pay a commission type fee for trades above their threshold. If the TSP board feels this is too much hassle, we are out of luck. Instead of active trading we will be relegated to tactical asset allocation discussions.
 
yeskevin,

I certainly respect your opinion, but a vast majority of TSP investors are not getting their matching funds or even holding a diverse allocation.

They, the TSP board, had to change the rules and make the L fund a default spot to get TSP investors "in" the market. Saving them from themselves once again.

There are other options instead of limiting IFT to two a month.
 
Well again, the point is the same. In your example those participants do not trade (naively sit in G). Therefore, TSP is able to cover their costs on those accounts. Contrast that with active traders with expenses far exceeding management fees on the account. Me, I entered trades on 15 days in November. There is no way a 6 bp fee is enough to cover the costs I generated. I feel I must deal with facts as they are, not the way I want them to be. If my active trading costs exceed the management fees, is it reasonable to expect TSP to allow me to continue? I would like the answer to be yes. However, I know the world does not operate for my benefit.

The point of my initial post was to point out we need alternative solutions when we contact the decision makers rather than clamoring for status quo. I feel 6bp fund fees and unlimited trading was way too much of a good thing. In my view, expecting that policy to remain is unrealistic.
 
yeskevin said:
Well again, the point is the same. In your example those participants do not trade (naively sit in G). Therefore, TSP is able to cover their costs on those accounts. Contrast that with active traders with expenses far exceeding management fees on the account. Me, I entered trades on 15 days in November. There is no way a 6 bp fee is enough to cover the costs I generated. I feel I must deal with facts as they are, not the way I want them to be. If my active trading costs exceed the management fees, is it reasonable to expect TSP to allow me to continue? I would like the answer to be yes. However, I know the world does not operate for my benefit.

The point of my initial post was to point out we need alternative solutions when we contact the decision makers rather than clamoring for status quo. I feel 6bp fund fees and unlimited trading was way too much of a good thing. In my view, expecting that policy to remain is unrealistic.
Click to expand...

Exactly, we need a alternative solution. I appreciate your comments. Thank you!
 
James48843 said:
Only one other person has called Rick Brown, a member of the body that stands between us and the change?


Rick Brown is the presidnet of the advisory council:

National Federation of Federal Employees
Richard Brown, President
805 15th Street, NW Suite 500
Washington, DC 20005

202-216-4420 (main)


I called over the weekend, and left a message by punching my way through to his voicemail. And now he's only gotten two phone calls?


ARISE TSPers, ARISE! CALL HIM!!!


While you are dailing-

Have you called your Congressman yet?

As crhuss points out- Congress listens when people are calling, and right now people are not calling.

Don't rely on someone else to do it for you. YOU need to pick up the phone and call your congressman.
Do it at lunch today.
Do it tomorrow.
Just do it.
Click to expand...

bump
 
yeskevin said:
If my active trading costs exceed the management fees, is it reasonable to expect TSP to allow me to continue? I would like the answer to be yes. However, I know the world does not operate for my benefit.
Click to expand...

Your humility is admirable but you are missing the fact that TSP recently (within the past six months) was boasting about how efficient the system was and how cost effective. How they had more money than ever and were over budgeted. I will look for the info (bet they've deleted it from their web site. May need to search here at tsptalk) but the point is that many of us are not so quick to accept this and are cynical that there is something else behind this change of heart.

If a system is efficient and working well for the users, that doesn't mean those users should need to pay what users pay for other non-efficient systems in the private sector. That seems to be one of their main arguments.

I personally believe there SHOULD be extra fees of some kind. I would be happy to pay $500 per year for unlimited trading. That should be enough initially to get the changes made and should be a clear statement that one is VERY serious about trading frequently.
 
Last edited:
My first reply back!!! Let's get the message out!

Mr.*****,

As a member of the board I have been limited on the number of TSP meetings I have been able to attend due to scheduling conflicts. I am attending the next meeting and I will include your concerns with my remarks.

Respectfully,
Charley Mapa
President
National League of Postmasters


703-329-4550
-----Original Message-----​


Sent: Wednesday, November 28, 2007 9:43 PM
To: Mapa, Charles W.
Subject: [SPAM] TSP limits
Importance: Low​


Dear Mr. Mapa,

I am not at all happy with the new policy that the FRTIB is proposing to implement. Not only are they trying to limit the number of interfund transfers permanently, they plan to punish anyone who exceeds the temporary limits. In the interim they plan to lock them out of electronic transfers if they exceed the 2 transfer maximum and only allowing mailed transfers. They are sending letters to the 3000 frequent traders to let them know in advance.

This is totally unacceptable because the real reason seems to be the managers of the funds inability to guess the Fair Valuation of the I fund correctly. That is what is really driving the cost up. How about posting the fund prices the next morning and eliminating the Fair Valuation.

I hope that as a member of the Employee Thrift Advisory Board you will protect the freedom to have "no limit on the number of contribution allocation or interfund transfer requests that may be made by a participant" as per Title 5 Chapter VI Part 1601 Subpart D Sec. 1601.32.b.

Title 5 Chapter VI Part 1601 Sec 1601.22 states that I "may make an interfund transfer using the TSP Web site or the ThriftLine". Punishing a individual for making more than two transfers by making them only use the mail would seem to be against the CFR.

Thank you for your time.



​
 
ayla said:
Your humility is admirable but you are missing the fact that TSP recently (within the past six months) was boasting about how efficient the system was and how cost effective. How they had more money than ever and were underbudgeted. I will look for the info (bet they've deleted it from their web site. May need to search here at tsptalk) but the point is that many of us are not so quick to accept this and are cynical that there is something else behind this change of heart.

If a system is efficient and working well for the users, that doesn't mean those users should need to pay what users pay for other non-efficient systems in the private sector. That seems to be one of their main arguments.

I personally believe there SHOULD be extra fees of some kind. I would be happy to pay $500 per year for unlimited trading. That should be enough initially to get the changes made and should be a clear statement that one is VERY serious about trading frequently.
Click to expand...


iagree.gif
 
I found the article that summarizes my point earlier about the apparent cost-effectiveness of TSP administration.

from: http://www.govexec.com/story_page.cfm?articleid=35042&dcn=e_gvet
(dated sept 18, 2006)

Please note particularly the part where it says:

"Costs for this transition left the TSP $3.9 million in excess of its budget for record-keeping. Savings in other areas, including personnel and communications to participants, offset the spending, allowing for the overall $6 million surplus.

TSP officials expect the trend of decreasing costs to continue."
 
DennisFAA said:
First of all...I'm sick and tired of would-be know it alls..Comparing the Government Employee's TSP to an outside private industry 401K or Vanguard’s plan, or whatever other damn retirement plan...blah,Blah,blah. Quit the the damn GOV and move to the private sector if you like the way they charge a fee for service so much!!...OUR TSP is suppose to be like none other and so it should be as the original rules for trading limits stated...

It’s the perogative of the government to amend a program which does not make fiscal sense. They can change tax rates, increase SS retirement age, reduce benefits, etc. Where did TSP indicate they can not amend our plan when we enrolled? Or that we are entitled to a superior plan verses the private sector? For that matter, most of us enrolled under the "original rules for trading limits" the antiquated system of mailing trades once a month. You are making opinions and using them as a statement of fact. I feel it is relevant to compare our plan to the lowest fee providers in the industry. I don't wan't this to change to be instituted. However, I realize this may be an instance where the minority yields to the majority.
Click to expand...
 
Here is what I sent to my Union representative on the advisory council.

Dear Susan Thomas,

I am an active trader in the Thrift Savings Plan, and I am very upset about the recent move to restrict interfund transfers (IFT) to two per month. It is my money, it is my retirement, and I want to maximize my investment! The Lifecycle funds are not working! They are barely outperforming CD Interest rates, and those funds are adjusted each day by “professional” money managers. If I can do better making my own allocations, what is the problem?

I am asking for an audit of all accounts in the TSP! I want to see proof of their expenses and where these expenses came from. Based on the September 18, 2006 Government Executive article, “Cost of running TSP lower than anticipated”, the September 17, 2007 “Minutes of the Meeting of the Board Members”, the “Federal Retirement Thrift Investment Board Budget”, and numerous other resources, the cost of administering the TSP is and has been under budget, specifically for years 2003, 2004, 2005, 2006, and the increase in 2007 is not entirely due to increased trading costs, but most likely due to “Other contractual services”, and the production of a DVD for participants who don’t read the available material.

If what I’ve read lately regarding the Board’s rationale for the IFT limitation, then the total cost to all 3.8 million TSP participants is only about $4.00 per year per person. It’s a small price to pay if it means I can miss market downturns and outperform the so called professional fund managers. Indeed, I have made transfers this year that have made me $1500.00 in one day, but I have also lost the same amount making an untimely transfer. This could happen whether I make frequent transfers, or adopt the “buy and hold” strategy the FRTIB wants us to use. Once again, it’s my money!

As my representative on the advisory council, I would like you to advocate for no limitation on interfund transfers. Thank you for your assistance.
 
I just got a e-mail that they are the Chair is trying to set up a mid-Dec. meeting of the ETAC. The are aware of us but we need to keep the pressure on until we know the outcome of the meeting.
 
Show-me said:
I just got a e-mail that they are the Chair is trying to set up a mid-Dec. meeting of the ETAC. The are aware of us but we need to keep the pressure on until we know the outcome of the meeting.
Click to expand...

I think that is what they are saying in this article:

http://www.governmentexecutive.com/dailyfed/1107/112907pb.htm

Long said TSP will discuss the trading restrictions with the Employee Thrift Advisory Council, which consists of labor unions and other federal employee groups, before moving forward. Colleen Kelley, president of the National Treasury Employees Union, said Tuesday that the council is in the process of planning a meeting to discuss the proposal.
"I'm open to the idea that there's a problem and seeing what a viable solution is," Kelley said. "I'm sure we can find a way to fix the problem without penalizing the federal employees in the plan."
 
3000 Tspartans!

http://www.tsptalk.com/mb/showthread.php?t=5204


http://www.tsptalk.com/mb/showthread.php?t=5193


Friends,

If you would, please visit the above link and call or write a few in not all of the persons on the list. They are hearing our voice, but if we slack off they will too. Even if you just leave a voice message after hour to the person that is on the Council. Most cell phone are free after 9 pm so call and leave a message for the person on the council.

A meeting is being planed for Mid-December and they will be getting organized about what they need to ask the FRTIB. We need to help them with that.


I get the impression that the Employee Thrift Advisory Council has been a token council in the past and this may be a real big test for them in opposing the FRTIB. We need to let them know how we feel so that they are in the right frame of mind.

All you have to say on the voice message is " I am strongly opposed to the 2 interfund transfer limits that the FRTIB is trying to implement. I want NO LIMITS!!! I also think a closer look needs to be taken at the I fund Fair Valuation first."


O something like this, "As my representative on the advisory council, I would like you to advocate for no limitation on interfund transfers. Thank you for your assistance."
 
Ralph Smith of FedSmith.com just put out another article on the proposed IFT restrictions today. Here is the link:

http://www.fedsmith.com/article/1434/

I just posted a comment to his article and told him to go back and do some real research on what the actual and projected expenses of the TSP are, instead of just quoting the nonsense they put out in their press releases. Mr. Smith wants to perpetuate the myth that 3,000 traders are causing a huge surge in expenses, when that is BOGUS! As we have previously discussed here, the Sept. 2007 Meeting Minutes of FRTIB and numerous other sources all indicate that TSP expenses are low, and getting lower!! We are down to about 2 basis points now (as contrasted to 10 basis points 5 years ago), and Greg Long, Exec. Director of FRTIB, projects that they will decrease further over the next few years, as TSP assets increase (they are increasing now at the rate of about $2 billion/month). All of this information is readily available, yet Mr. Smith takes the lazy approach and simply passes on the B.S. that he reads in the TSP press releases. I suggest everyone write to him and set him straight!!!
 
subject: Roadmap for contacting congressmen and senators

Contacting your senator couldn't be easier at:

http://www.senate.gov/general/contact_information/senators_cfm.cfm


Contacting your representative couldn't be easier at:

http://www.house.gov/writerep/

DO IT NOW!

I have learned that because of the extensive filtering that is done for postal mail sent to our senators and representatives, it can take a month of so for them to get postal mail. When I called, the individuals I spoke with at the senators office indicated they much preferred email and more specifically that we use the web contact form available.

So this is a lot easier than having to pick up pen and paper and write (heaven forbid) a hardcopy mail message. PLEASE take the time to let them know you are interested. There have been candidate letters written here. I am one of those who would be happy to pay some fee if they would continue to allow unlimited transfers so that is included in one I chose.

Below are the comments I left with my congressmen (copied from the tsptalk web site at http://www.tsptalk.com/mb/showthread.php?t=5204) except with minor changes since I am retired and also that this was going to congressmen and not to the TSP board. (Do we have a list of TSP board email addresses yet, or their names?)

I also added a short paragraph about the tentative meeting planned for mid-December. This hopefully might expedite the attention this message gets.

=============

Below is the message I left. There is a limit of 10,000 characters for all of the above and this message below fit with lots of room to spare (no attachments, they advise).

--- <starts here>---
I have learned of the intention by the Thrift Savings Plan Board to impose a restriction on Thrift Savings Plan(TSP) trading activity, specifically limiting participants to no more than two (2) transfers per month. An article was published in the Washington Post on November 20th about a meeting on November 19th of the TSP board where this was voted on. I believe this will have a serious, negative impact on my ability to maximize my retirement account, which in turn lowers my quality of life in retirement. This is incongruent with the philosophy of the TSP program.

As a recently retired federal employee faced with the challenge of ensuring I have put aside adequate funds for my retirement, the TSP is an excellent investment option. Through my active participation, my returns have been much greater than they would have been if the number of transfers was restricted, as you are recommending.

Based on the September 18, 2006 Government Executive article, “Cost of running TSP lower than anticipated”, the September 17, 2007 “Minutes of the Meeting of the Board Members”, the “Federal Retirement Thrift Investment Board Budget”, and numerous other resources, the cost of administering the TSP is and has been under budget, specifically for years 2003, 2004, 2005, 2006, and the increase in 2007 is not entirely due to increased trading costs, but most likely due to “Other contractual services”, and the production of a DVD for participants who don’t read the available material.

As justification for the transfer limitations, they cite Federal Employees' Retirement System Act of 1986 (FERSA) sec. 8475 which directs the board to “develop investment policies…which provide for…low administrative costs.” However, in 5 CFR Ch. VI, Subpart D “Contribution Allocations and Interfund Transfer Requests”, §1601.32(4)(b) “Limit. There is no limit on the number of contribution allocations or interfund transfer requests that may be made by a participant.”

To allow my continued active participation in maintaining an adequate retirement income, I would be more than willing to pay an off-setting fee to TSP for the increased transaction costs. Therefore, I ask that they give further consideration to not imposing restrictions on TSP trading activity.

More specifically, it is my understanding that the Employee Thrift Advisory Council, which consists of labor unions and other federal employee groups will tentatively have a chance to submit comments to a meeting being planned for mid-December (I'm concerned about attendance - not a good schedule for effective information gathering.) No date yet. Any help you can provide in supporting my position at this meeting would be greatly appreciated.

Sincerely,
 
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