Why can’t TSP give participants a few more interfund transfer opportunities per month?


Currently TSP only allow two interfund transfers per month. I agree they should not go back to the days when monthly transfers were unlimited, but limiting it to two per month hardly allows participants to “manage” their TSP funds. Come on guys…How about four transfers per month?

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Asked on July 29, 2020 6:29 pm
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"Why" questions are always hard to respond to because we can't really put ourselves inside the mind of those (i.e., the Thrift Board) who made the decision. But, you raise a good issue.
Way back in the early days of the TSP, interfund transfers were severely restricted and didn't take place immediately. Once the TSP got its new computer system, the Board allowed interfund transfers on a daily basis. When a small group of participants tried to "day trade" their TSPs, the Board went to the current two transfers a month rule.
There's nothing magic about the number two, and many participants who use TSP monitoring services like TSPSafetyNet or the TSP Strategist would like to have the opportunity to move funds around more than twice a month.
Don't forget, however, that we can make more than two interfund transfers in a month. The two per month limit is on unrestricted transfers. After two transfers have been made, you can still make "safe harbor" transfers. A safe harbor transfer allows you to move money only to the G Fund.
I do like your suggestion of 4 transfers and will forward it to the TSP.

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Answered on July 30, 2020 1:11 pm