As a just retired Fed, I can offer a few thoughts. -The 4.5% rate of return you cited is the average rate of return. If you go to the actual year-to-date rate of return (https://www.tsp.gov/funds-individual/g-fund/?tab=performance-and-risks) you'll see its 1.80%. Big difference! This is how I am utilizing the G fund to minimize the sequence of return risk as well as the risk you identified. I kept 1.5 years of withdrawals in the G fund and have them send me my monthly amount. This way I get my monthly pension deposit and TSP deposit which addresses my monthly income needs. All my other TSP funds were rolled over to Fidelity. I have 5 years of needed income in a CD ladder that once it matures I annually roll over to the TSP to replenish the G fund. The rest of my funds are in equities. 6 years from now I will stop the monthly disbursement from the TSP (will have roughly 6 months of funds remaining there) and will start taking disbursements from Fidelity instead. Since I am under 59.5, I can only withdrawal from the TSP without penalty, so this strategy was part necessity. Its worked out well since one must withdrawal from the TSP funds equally. Having everything in G with TSP and fidelity with everything else makes the TSP restrictions bearable.
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As a just retired Fed, I can offer a few thoughts. -The 4.5% rate of return you cited is the average rate of return. If you go to the actual year-to-date rate of return (https://www.tsp.gov/funds-individual/g-fund/?tab=performance-and-risks) you'll see its 1.80%. Big difference! This is how I am utilizing the G fund to minimize the sequence of return risk as well as the risk you identified. I kept 1.5 years of withdrawals in the G fund and have them send me my monthly amount. This way I get my monthly pension deposit and TSP deposit which addresses my monthly income needs. All my other TSP funds were rolled over to Fidelity. I have 5 years of needed income in a CD ladder that once it matures I annually roll over to the TSP to replenish the G fund. The rest of my funds are in equities. 6 years from now I will stop the monthly disbursement from the TSP (will have roughly 6 months of funds remaining there) and will start taking disbursements from Fidelity instead. Since I am under 59.5, I can only withdrawal from the TSP without penalty, so this strategy was part necessity. Its worked out well since one must withdrawal from the TSP funds equally. Having everything in G with TSP and fidelity with everything else makes the TSP restrictions bearable.
Post: TSP G Fund as the only Fixed Income Investment
Link to comment from June 22, 2026
Agree. Any money saved using online resources typically have issues that an attorney has to correct or the beneficiaries will have to suffer through.
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Link to comment from May 24, 2026