Q. When the Thrift Savings Plan calculates my Personal Investment Performance, are the matching funds that the government deposits considered part of the investment, or are they considered part of the investment return? For example, if my PIP for the past year is 10 percent, did I actually earn 10 percent on all of the money in the account, or is it only 10 percent because the government added to my balance?
A. From the TSP website:
“Personal Investment Performance (PIP) — The rate of return earned by your entire account during the 12-month period ending on the date indicated on your annual statement or on your Account Balance page of the TSP website. The PIP is a time-weighted return that has been calculated using a modified-Deitz method (a method used by many financial institutions and an industry standard). The PIP adjusts for the distorting effects of cash flows into or out of your account. It is an estimate; therefore, your PIP may not be the same as the 12-month performance of the TSP funds, which are time-weighted returns.”