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Return to Article: Thrift Savings Plan readies for new investment fund

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  Ok folks let's do this again. If the money is your money why is it the TSP board took it away from you and paid the crooks for their bad programming job?

  I contend the money you and I put in the TSP belongs to Mr. Amelio. If I am wrong please show me the proof. These people will cave into the government and give your money to them forever unless we, the people, take back OUR money.

  I have been writing about this for a year and not one person has said the money belongs to me or you. Mr. Amelio is in total control of the money in the TSP and he is a thief.

  GovExec.com reader Posted May 5, 2004 7:33 AM
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  I think "Anti-whiner" is the same person as "Is it worth the whine," and I believe he/she is on the TSP board.

  GovExec.com reader Posted April 26, 2004 6:31 AM
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  Stop whining. First off they (being the government) can't dip into your fund before you retire. At least yet. They can borrow from the G fund but anyone in that thing is an idiot to begin with. And I don't care if you're two days away from retirement. Grow up; seek financial advice on your total asset allocation; and get on with your life. You do not have to invest in the new fund.

  By the way heard the same types of arguments from the same types of people when I and S were introduced. I'm making a killing. And it's my money.

  Anti Whiner Posted April 22, 2004 6:27 PM
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  It seems not long ago that complaints were raised about the large number of federal employees not queuing up to the TSP bandwagon. Then, federal workers joined in large numbers. The employees later watched as TSP investments were caught in the political tug-of-war between Congress and the President during the mid-1990s--after billions of dollars were earned in the risky "C Fund" bearing stocks. Our politicians started licking their lips over the cash cow created by federal worker contributions in the TSP. Our investments were used to pay government bills then due and owing. This happened twice.

  Then, as the stock market crashed, the workers who watched their portfolios dwindle, sought refuge, in part, by moving their investments into the conservative G Fund. Some took a risky course of moving investments more often. The TSP Board gave us more flexibility to accommodate all types of investors. Yet, once that flexibility was exercised, Mr. Amelio fingered the TSP participants as the culprits for crashing the computer system. We are the evil poster children because we are either day/weekly or monthly traders or conservative investors. The problems experienced by the TSP with getting the computer system operational for daily valuations were not caused by the participants. Yet, Mr. Amelio fingers the participants as the wrong-doers.

  His solution is to cook up this new scheme of outsourcing that does nothing more than let someone else feed at the $130 billion trough federal employees funded.

  Jeff Babcock Posted April 22, 2004 3:59 PM
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  I was amazed to read comments that mirror my thoughts and impressions of this new program which Mr. Amelio and the Board is trying to implement. By, the way, how much money are the Board members investing in TSP or are they exemp or ineligible? I, too, feel that "participants are not diversifying enough" equals participants are not spending enough of their hard-earned dollars in the various TSP programs. Who has been managing the funds to date and why is it necessary now to hire a contractor to "manage" our money for us? Why is it necessary to hire a "communicator" to do what the "leaders" of TSP should already be able to do, i.e., communicate? All I am hearing now is "spend more of your money, spend more of your money". We are now being TOLD we will pay for the costs to implement a program in which maybe 10% of the participants will invest. We are being TOLD - not asked - told - that we are to pick up costs of implementing the computer system (which, apparently is still not completed), pay the fees for loans which other people take out, subsidize this "lifeystyle" or "life cycle" programs (which perhaps 10% of the participants will utilize), pay, pay, pay. And then, Mr. Amelio wonders why we are not putting more of our hard-earned bucks into a program that worked perfectly fine until recently (until the new computer system). Question to Mr. A. What are you thinking?

  GovExec.com reader Posted April 21, 2004 1:10 PM
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  TSP is out to lunch! If they have a life cycle plan that is fine because it is designed for stupid people and we all know that we are stupid and they know better how we should invest. Hopwever, no one is forcing you into the life cycle plan so don't signup if you think it is a bad deal or they are correct - you are stupid.

  However, I would like to know why the TSP board does not have an index fund for common stocks (the S&P) and for corporate bonds (not government bonds that politicians can stop you from buying like they did in the past and which is the stupidest thing I know of). The index funds should be unit trusts and have extremely low expense ratios. The lining of pockets was done in the past with the introduction of the small cap and international funds as far as I am concerned.

  Finally, TSP should stop making loans as they do. They use my money to subsidize borrowers by not charging them a fair market cost of borrowing. The new $50 a loan is ridiculous and probably costs more to implement than the fund receives. The cost should be more like $300 a loan and TSP should receive one half of one percent of the principle every period on the outstanding balance. Better yet they should not make loans! However, if loans continue the revenues generated by the loan should go to cover the expenses of the TSP operation and reduce the costs to us that invest rather than subsidizing borrowers!

  tax payer Posted April 21, 2004 6:52 AM
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  Maybe all TSP participants should consider not making any more contributions to TSP until they fix the system to where it benefits the people that are invested in it. If everyone did that for say, six months, maybe just maybe someone would wake up and realize we are not going to stand for them mishandling our money.

  Deborah Mulkey Posted April 21, 2004 6:38 AM
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  Dear Participants:

  I have a question for you.

  It is often said that although professionally managed mutual funds attempt to beat the DOW Industrial Average, approximately 80-85% of professionally managed mutual funds do not beat the DOW Average.

  Imagine this if you will...it's not the year 2004. Its 2009, five years in the future. Participants who selected the "professionally managed fund" finally wake up ... do the math ... and determine that they were not "managed" so well after all.

  They find a lawyer. They sue in a class action. They win. Big.

  Who pays the millions to them?

  Alger Davis - TSP Participant Posted April 21, 2004 5:37 AM
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  I want to "ditto" all the comments on this article presented below. I, too, believe Mr. Amelio is a "cocked cannon" rolling around on deck. He is dead set on lining the pockets of his "industry" friends by establishing another fund for them to manage. The TSP staff, even with that wonderful (??) new system, can't get the business generated by the current five funds posted on a timely basis now. What is going to happen when another fund or two is added?

  Currently DFAS sends all participant contributions and loan payments to the TSP service center by electronic tape at the same time. Now, with a little luck, contributions get posted on the Monday before payday and loan payments get posted by the Friday after payday. Is this efficiency in action?? Adding another fund will likely end up adding to this "backlog" Mr. Amelio is credited with eliminating. Progress??? I think not! This untimely posting of receipts in a period of market growth can cost participants a lot of money and Mr. Amelio is worried about participants mismanaging their funds? Again, I think not. I do think it is time participants demand the we be allowed representation on this "Advisory" board so we can express our own desires and views. Now we have to accept everything this man, Amelio, who speaks out of both sides of his mouth, says is with no recourse. Another Concerned TSP Participant

  John R. Lawter Posted April 20, 2004 1:32 PM
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  Everybody get ready for the govt to dip into the TSP fund to help offset the deficit in the same manner they are using Social Security to do so. We will have nothing when we retire.

  GovExec.com reader Posted April 20, 2004 11:35 AM
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  Good Grief!

  Once again, we venture forth to fix something that is not broken. Tinkering with our retirement savings is an attempt by Mr. Amelio to leave a legacy; a gamble, at someone else's expense.

  Mr. Amelio, if you feel lucky, take the red eye to Las Vegas, where you can wager what is yours.

  GovExec.com reader Posted April 20, 2004 11:21 AM
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  Sure would be nice if the Board debugged the "new" system before concerning themselves with new features like this.

  GovExec.com reader Posted April 20, 2004 9:54 AM
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  If this new option is voluntary and your best-case projections say only 10% will participate, then why are the administrative costs being spread across all participants? Isn't this comparable to the voluntary loan program where you changed your regulations to charge a fee to those who make loans in order to keep the rest of the non-loan participants from picking up the tab of the program? Why not charge a fee for this new life cycle fund for those that want to make use of this program? If I don't use this "voluntary" program, then why should I be forced to pay for it?

  GovExec.com reader Posted April 20, 2004 8:29 AM
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  This article is all about money. Not increasing participants retirement fund money, but rather how to get more money out of the plan into the hands of favored contractors.

  In the GovExex article of April 8, 2004, regarding the loan fee of $50.00 per loan, it was said that 80% of the participants who do not have loans (at this time) subsidize the 20% who do have loans. According to the Board, that was not fair, hence a $50 fee would be imposed for each loan.

  In the current article, talking out of the other side of his mouth, Amelio is quoted as saying... "For simplicity's sake, for efficiency's sake, the cost of the program is going to be allocated across the plan." He also expects best case scenario ... 10% of the participant's to opt for this new "managed fund" during the first year.

  Why do the other 90% have to subsidize the 10% who will be making a foolish decision to have their money "managed"? Mr. Amelio you will not get 10% of the TSP participants to put their money in your new plan. You will be lucky to get 3%. We are not as stupid as you think.

  There is no such thing as long term employment in the Federal Government. A young person starting out on a career cannot count on 30 years of employment. What does he do 9 years down the road when he gets his RIF notice (It happened to me in 1982) and he has invested in high risk funds that just happen to be losing money at the time he no longer has a job?

  If 10 participants want to be "managed", let them bear the burden of the cost.

  As I sit at my HOME COMPUTER writing this as a TSP PARTICIPANT all I can say in conclusion is that we need alternate choices for our contributions. There needs to be other places that our contributions can go besides the Thrift Savings Plan. Maybe with real competition you guys will get your act together.

  Alger Davis - TSP Participant Posted April 20, 2004 8:25 AM