Is TSP liable to give investment advice
TSP has around 4.7 million members from all over the country and currently the administrators are discussing whether they should be offering investment advice to their members or not.
TSP to offer investment advice?
This was not announced publicly but was made public knowledge via a report that has been released on the 2015 Conference on Aging. It’s mentioned specifically that the Thrift Investment board is actually making the consideration whether they should provide personalized advice for investments or not.
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The closest TSP gets to giving advice is in the Lifecycle funds program. The TSP website lists the following paragraph about it: “We use professionally determined investment mixes that are tailored to meet investment objectives based on various time horizons. The objective is to strike an optimal balance between the expected risk and return associated with each fund,”
The board believes that one of the main reason retirees withdraw from their TSP accounts to put money elsewhere is that they are not guided enough. Many surveys done in the recent past have also indicated this lack of guidance to being a big reason why members don’t believe in TSP.
All things considered, we definitely believe that the TSP members require some sort of guidance from their fund managers about investments because this is something of substance and when there’s money involved everybody needs to be absolutely sure. In this regard, an executive order to offer formal guidance could be around the corner and we hope that for the benefit of the majority, it does get implemented soon.
