One More TSP Transfer, Please!

In late 2007, the TSP announced that they would be implementing restrictions to the number of interfund transfers you can make in your Thrift Savings Plan account. We went from unlimited transfers, to two per month. I feel very strongly that one more transfer per month might actually work. Two is not always enough.

Right now with the two interfund transfer limit (plus the unlimited G-Fund transfers), there is no room for error. With three transfers you can actually make a mistake and not be completely stuck. You would have the opportunity to buy and sell twice during a month, rather than once.

As you may know two transfers basically allows you buy into the stock or bond funds one time, leaving you one transfer to sell. One round-trip trade as they would call it at a brokerage firm.

If you do transfer into stocks and it turns out to be bad timing, you might want to step aside again by moving back into the G-fund before your account takes a big hit – but then you are stuck!

With a 3rd transfer you’d get another shot rather than sitting on sidelines waiting for the month to end.

When the TSP implemented the tranfer limits, the market was still behaving quite orderly, and had for the prior 4 to 5 years. Since then, volatility has picked up in a big way and our TSP balances have been swinging wildly. Does anyone remember late 2008? Wow!

I doubt we’ll ever see unlimited transfers again, but can we get one more – One more interfund transfer, please? Thank you.

Please share this with your co-workers. Let’s get the word out that we’d really like to be given one more transfer per month.

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