Q. I had all my funds in the L Fund most closely related to my retiring date until this afternoon. After learning that my overall value dropped by $5,000, I got worried and moved everything to the G Fund. Then I spoke to a friend who explained to me the $5,000 loss was really only a decrease in value, and not real money. Now that I better understand I would like to move back to the L Fund. Will I be penalized or will my funds be significantly effected because i did this switch?
A. With all due respect, it sounds like whether or not you will be penalized for reallocating your TSP funds might be the least of your problems – you will not. I think the more important cause for concern is the way you are managing your money! This doesn’t sound like a reliable investment management approach for such an important asset. You may want to find some competent help.