Risk to G Fund in case of government default


Q. Is it possible that folks’ G Fund in the TSP could literally dissolve/evaporate if the U.S. government “defaults” next week? I believe it’s possible, and, in a game of chicken, no one would care if federal employees took a hit like this. In fact, some may take relish in the political opportunity to blame the opposition for gain.

A. I can’t say that loss of G Fund assets is impossible, but it’s so unlikely to happen that it’s not worth worrying over. How do you see the U.S. government confiscating more than $100 billion in privately owned property held in trust?


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Mike Miles is a Certified Financial Planner licensee and principal adviser for Variplan LLC, an independent fiduciary in Vienna, Virginia. Email your financial questions to fedexperts@federaltimes.com and view his blog at money.federaltimes.com.

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