TSP Funds Take a Hit Amid New COVID Concerns, and More
A weekly roundup of pay and benefits news.
Most portfolios in the federal government’s 401(k)-style retirement savings program returned to red balance sheets last month as concerns about a new COVID-19 variant impacted financial markets.
The Thrift Savings Plan’s fixed income (F) fund was one of only two funds to end November in the black, growing 0.30% last month. So far this year, the F Fund has lost 1.14%. The G Fund, which is made up of governmental securities and increases at a statutorily mandated rate, gained 0.13%, good for a 2021 total of 1.26% so far.
The common stocks of the C Fund lost 0.69% in value in November, bringing its 2021 performance down to 23.16% in gains. The international (I) fund fell 4.66% last month, although it remains 6.04% in the black for the year.
The worst performer in the TSP last month was the S Fund, composed of small- and mid-size businesses. It lost 5.03% in value. So far this year, the S Fund has grown 11.80%.
All of the TSP’s lifecycle funds also finished November in the red. The L Income Fund, designed for participants who already have begun making withdrawals, lost 0.50%; L 2025, 1.09%; L 2030, L 2035, 1.72%; L 2040, 1.89%; L 2045, 2.04%; L 2050, 2.20%; L 2055, 2.71%; L 2060, 2.71%; and L 2065, 2.71%.
So far this year, the L Income Fund has grown 4.32%; L 2025, 7.70%; L 2030, 9.58%; L 2035, 10.38%; L 2040, 11.19%; L 2045, 11.85%; L 2050, 12.55%; L 2055, 15.21%; L 2060, 15.21%; and L 2065, 15.20%.
Locality Pay Decisions Stall Without Biden Appointees
The Government Accountability Office on Tuesday reported that multiple long-awaited decisions related to how federal employees’ locality pay is calculated have stalled due to a lack of consensus during the Trump administration and, now, because President Biden has failed to appoint new members of a federal advisory body.
The Federal Salary Council provides recommendations to the president’s pay agent on federal compensation issues, particularly those relating to locality pay. Over the course of the previous administration, conservatives on the panel have been at loggerheads with federal employee groups over a proposal to include non-salary benefits in federal salary comparisons with their private sector counterparts, as well as how to implement multiple recent updates to the Office of Management and Budget’s map of metropolitan statistical areas into the locality pay area map.
Now, those decisions have stalled because Biden has not appointed a new slate of members of the salary council, effectively preventing new recommendations from being made to the president’s pay agent. Additionally, the lack of members on the salary council prevents the council from making its annual set of recommendations on whether to establish new locality pay areas or add counties to existing locality pay areas.