All retirement investment vehicles, including the TSP, charge fees in order to meet their expenses. While this cost is only one of several factors you should consider when making investment decisions, the cumulative effect of expenses and fees can substantially reduce the growth of your investments. We encourage you to visit the Department of Labor’s webpage about retirement plan fees.
Administrative and investment expenses
We break our expenses into administrative expenses and investment expenses.
TSP gross administrative expenses cover the costs of administering the Plan:
- the cost of operating and maintaining our recordkeeping system
- the cost of providing participant services
- the cost of printing and mailing of notices, statements, and publications
These expenses are first paid by forfeitures of Agency/Service Automatic (1%) Contributions of FERS and BRS participants who leave federal service before meeting vesting requirements. What remains after using forfeitures to cover costs are net administrative expenses.
| gross administrative expenses |
| – forfeitures |
| = net administrative expenses |
We also have investment expenses, which are the fees we pay to our investment managers.
To meet our total expenses—net administrative expenses and investment expenses—we make small reductions to our funds’ earnings. All TSP participants in a given fund pay the same percentage of their investment in the fund to cover expenses. This percentage is called an expense ratio. An expense ratio is the result of dividing total expenses by the average dollar amount held in the fund.
Example: In the first table below, you’ll see that the total expense ratio for the C Fund in 2022 was 0.059%. Another way of saying that is that TSP participants’ investments in the C Fund were reduced by 59 cents for every $1,000 invested. A participant with $1,000 invested in the C Fund paid 59 cents toward the fund’s expenses; a participant with $100,000 invested paid $59. Everyone pays the same percentage. So the larger your share of the fund, the larger your share of the expenses.
You can quickly convert the expense ratios in the tables below to cost-per-$1,000-invested by moving the decimal point one space to the right. (For example, 0.059% converts to $0.59, or 59 cents.)
This first table shows, for each of the TSP individual funds, the 2022 gross administrative expense ratio, the net administrative expense ratio, and the investment expense ratio. It then adds the net administrative expense ratio to the investment expense ratio to show you the total expense ratio. This is how much the fund’s earnings were reduced to cover expenses.
| G Fund | F Fund | C Fund | S Fund | I Fund |
|---|---|---|---|---|
| Gross administrative expense ratio | ||||
| 0.067% | 0.068% | 0.068% | 0.068% | 0.068% |
| Net administrative expense ratio | ||||
| 0.057% | 0.058% | 0.058% | 0.058% | 0.058% |
| Investment expense ratio | ||||
| 0.000% | 0.020% | 0.001% | 0.032% | 0.006% |
| Total expense ratio (Net admin + Investment) | ||||
| 0.057% | 0.078% | 0.059% | 0.090% | 0.064% |
The next table shows the same information for each of the TSP’s Lifecycle (L) Funds. Because each of the L Funds is made up entirely of varying amounts of the G, F, C, S, and I Funds, the expense ratios shown here reflect the expenses of the underlying funds in each L Fund. The L Funds don’t have separate expenses.
| L Income | L 2025 | L 2030 | L 2035 | L 2040 | L 2045 | L 2050 | L 2055 | L 2060 | L 2065 |
|---|---|---|---|---|---|---|---|---|---|
| Gross administrative expense ratio | |||||||||
| 0.067% | 0.068% | 0.068% | 0.068% | 0.068% | 0.069% | 0.068% | 0.069% | 0.069% | 0.069% |
| Net administrative expense ratio | |||||||||
| 0.057% | 0.058% | 0.058% | 0.058% | 0.058% | 0.059% | 0.058% | 0.059% | 0.059% | 0.059% |
| Investment expense ratio | |||||||||
| 0.003% | 0.004% | 0.006% | 0.006% | 0.007% | 0.007% | 0.008% | 0.008% | 0.008% | 0.008% |
| Total expense ratio (Net admin + Investment) | |||||||||
| 0.060% | 0.062% | 0.064% | 0.064% | 0.065% | 0.066% | 0.066% | 0.067% | 0.067% | 0.067% |
Fees
Some individual TSP transactions have fees:
