How should I invest my TSP?

Written By Tyler Scott

“I Lost 13 Years of Growth.”

That’s one of the first things my Chief said to me on my first day at my last duty station with the National Park Service. Chief gave the same talk to all his new officers to prevent the mistake he had made with his Thrift Savings Plan (TSP) contributions.

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“Don’t put it all in the G-Fund,” he told me.

The G-Fund, for those who don’t know, is essentially a cash savings account… not how you want to invest your retirement contributions.

So how should you invest your TSP contributions? Any good advisor will have two answers to that question:

  1. It depends

  2. A diversified portfolio

Portfolio allocation is incredibly personal to your risk tolerance, how close you are to retirement, and what sort of other investments or pensions you have. Knowing where to start can be confusing, with 16 core TSP funds to choose from AND an option to use the mutual fund window.

So let’s simplify things a bit.

5 Core Individual Funds

  • G Fund: Performs like cash, guaranteed by the U.S. government not to lose principal.

  • F Fund: Tracks a broad U.S. bond market index.

  • C Fund: Tracks the S&P 500 Index, large-cap U.S. companies.

  • S Fund: Tracks mid-to-small-cap U.S. companies.

  • I Fund: Tracks international stocks in developed markets.

11 Lifecycle Funds

These are target-date funds blended using varying proportions of the 5 core funds. They automatically shift toward more conservative allocations (more G and F funds) as you approach whichever lifecycle year you selected:

  • L Income: Designed for current retirees or those withdrawing money immediately.

  • 10 Target-Date Funds (as of 2026): L 2030, L 2035, L 2040, L 2045, L 2050, L 2055, L 2060, L 2065, L 2070, and L 2075.

The most important thing is to do something; whether you choose one or many of the funds above, or opt to select from the thousands of mutual funds, pick a strategy that works for you and stick to it.

Buying and holding stocks outperforms trading strategies 99.8% of the time!

3 Basic TSP Strategies

You might be asking at this point, what fund should I buy in my TSP? There are as many answers to that question as there are investors with TSP accounts. Here are three basic strategies you can use:

1. Set It and Forget It

Just as the name implies, you can buy a target date fund – or L fund – according to your planned retirement date. As you get closer to retirement, the fund will automatically rebalance over time from being mostly stocks (the C, S, and I funds) to mostly bonds (the G and F funds).

2. Warren Buffett 2-Fund Portfolio

If you want to bet on America, this might be the strategy for you. Warren Buffett recommends a 90/10 allocation of “equities” and “fixed income”. That’s a fancy way of saying put 90% of your investments into stocks and 10% into bonds. Specifically, put 90% of your investments in an S&P 500 index fund – those are the 500 largest companies in the market at any given time.

To model this portfolio, simply put 90% of your TSP into the C Fund and 10% into the G or F Funds.

3. Jack Bogle 3-Fund Portfolio

If you want to bet on America AND our allies, then try out the 3-Fund approach from Vanguard Founder Jack Bogle. Jack recommends splitting a portfolio between the U.S. total market, international markets, and bonds. How you split up the 3 funds is up to you – although most investors agree to invest the bulk in U.S. Stocks, and then allocate the rest between international markets and bonds depending on your risk appetite (more bonds is considered lower risk).

To create this portfolio in the TSP, you will need:

  • The C and the S funds (together, these represent the U.S. total market),

  • The I fund (international “developed” market), and

  • The F or G Fund, or both (bonds)

The Bottom Line

The most important part of investing is to stay invested and to contribute to your TSP every single paycheck. Whether you pick one of these strategies, develop your own, or hire an advisor does not matter as much as staying invested… time in the market beats timing the market.



Disclaimer: This blog is for educational and informational purposes only and does not constitute financial, investment, tax, or legal advice. I am not a registered investment advisor. The opinions expressed here are strictly my own.

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Tyler Scott