Contributions

[savila]

Hi, can anyone help me out?
I am a little confused as to how Interfund transfers work as opposed to just doing an contribution allocation. I also noticed that when I do a interfund transfer the money is going to two different places: account distribution and contribution allocation. what is recommended? Can someone explain this like I am just a fed employee with no knowledge of this.
Thank you.

[jlozano042]

IFT, interfund transfers, is the actual movement (buying/selling) of a percentage from/to your TSP balance. You are actually buying/selling shares, "you are re-allocating your existing account among the TSP funds".

Contribution allocations, is the money from your check that goes into a specific fund or multiple funds. The funds sit there and accrue/loose money over time until you do an IFT.

These two allocations DO NOT need to be the same, some folks like to keep them the same.

So for me - my most recent IFT was done sometime back in March where I put it as 45% C, 45%S, and 10% I.

My contribution allocation is 100% S ---> meaning every time my TSP amount is pulled from my bi-weekly check it goes 100% into the S fund.

Any of that make sense?

[jlozano042]

I also noticed that when I do a interfund transfer the money is going to two different places: account distribution and contribution allocation.

The two are different. The first one - account distribution is technically your IFT. The second one - contribution allocation is where your TSP from your check is going.

As I stated before, some folks like to keep it the same. Some don't ... it's your preference.

[savila]

That makes a lot of sense.
Thank you I appreciate

[jlozano042]

Sure .... if I may though, my spidey-sense is being triggered. You've had an account since late-2015 and have a pretty good run on your fantasy TSP account - these questions of yours seem a bit amateur in regards to your activity. Just curious really.

[savila]

I was testing your knowledge .... I had a coworker who used to advise me on how to allocate my money. This year I just left it on the S fund and now I am trying to understand how this game is played.

[jlozano042]

understood .... makes sense!