Updated August 6, 2026. Quick answer: the TSP funds are not products someone designed and marketed. Five of them are defined in a federal statute that tells the Board what each one is required to hold, and the sixth is a default. Read that way, one of them is genuinely unusual and the other four are ordinary index funds with unusually plain instructions. This page describes what the law requires. It does not rate the funds and does not tell anyone what to hold — there is nothing to sell here.
The G Fund: a long yield on a security that is not for sale
The G Fund is the one with no private-sector equivalent, and the reason is a two-part asymmetry written into 5 U.S.C. §8438.
Part one — the securities are made for it. Under §8438(e)(1), “[t]he Secretary of the Treasury is authorized to issue special interest-bearing obligations of the United States for purchase by the Thrift Savings Fund for the Government Securities Investment Fund.” These are issued to the fund. They are not bought on an open market, and their maturities, per §8438(e)(2)(A), are “fixed with due regard to the needs of such Fund as determined by the Executive Director”.
Part two — the rate comes from somewhere else entirely. The same paragraph sets the interest rate at “the average market yield… on all marketable interest-bearing obligations of the United States then forming a part of the public debt which are not due or callable earlier than 4 years after the end of such calendar month”.
So the yield is taken from the longer end of the Treasury curve — only obligations four years out or more are counted — while the fund’s own holdings are special issues with maturities set to suit the fund. The rate is recomputed monthly from market quotations at the end of the preceding month, and §8438(e)(2)(B) rounds it: any yield “which is not a multiple of one-eighth of 1 percent, shall be rounded to the nearest multiple of one-eighth of 1 percent.”
What the statute does not say. You will read almost everywhere that the G Fund cannot fall in value. §8438 does not say that. It does not address redemption before maturity, par value, or transferability at all — those sit in the terms on which Treasury issues the obligations, and we did not read those terms. We are not going to repeat a guarantee we have not sourced. What is sourced is the construction above, and it is the part that explains why the fund behaves unlike a bond fund holding the same maturities.
The F Fund
The Fixed Income Investment Fund, at §8438(b)(1)(B), is invested in “(i) insurance contracts; (ii) certificates of deposits; or (iii) other instruments or obligations selected by qualified professional asset managers, which return the amount invested and pay interest, at a specified rate or rates, on that amount during a specified period of time”.
Note what is delegated: the statute names categories and hands the selection to “qualified professional asset managers”. Unlike the equity funds below, no index is written into the law.
The C Fund
For the Common Stock Index Investment Fund the Board “shall select an index which is a commonly recognized index comprised of common stock the aggregate market value of which is a reasonably complete representation of the United States equity markets”, and the fund “shall be invested in a portfolio designed to replicate the performance of the index selected”, weighted in proportion to market value.
The S Fund
The Small Capitalization Stock Index Investment Fund takes “an index which is a commonly recognized index comprised of common stock the aggregate market value of which represents the United States equity markets excluding the common stocks included in the Common Stock Index Investment Fund”.
The definition is subtractive, and that is the fact worth carrying: the S Fund is defined as the part of the domestic market the C Fund leaves out, not as a size category chosen on its own terms. The two are complements by construction.
The I Fund
The International Stock Index Investment Fund uses “an index which is a commonly recognized index comprised of stock the aggregate market value of which is a reasonably complete representation of the international equity markets excluding the United States equity markets” — again subtractive, this time excluding the whole domestic market.
The L Funds, and what a default means
The lifecycle funds enter the statute from a different direction: not as a listed fund, but as the default. Under §8438(c)(2), where the statute directs a default investment, “the Executive Director shall invest such sums in an age-appropriate target date asset allocation investment fund, as determined by the Executive Director”.
Two consequences follow from that sentence and neither is an opinion. First, the composition is set administratively, not by statutory index rules like the C, S and I funds — it is “as determined by the Executive Director”. Second, a lifecycle fund is where money goes when nobody chooses, which is a different thing from a fund somebody selected.
How often the law says you may switch
§8438(d)(1) sets a floor, and it is a low one: “[a]t least twice each year” a participant may elect which funds their money is invested or reinvested in, in accordance with regulations the Executive Director prescribes (§8438(d)(2)).
That is the statutory minimum guarantee, not a description of the current interface. The point of reading it is to see that the frequency is administrative — the law guarantees twice a year and leaves the rest to regulation.
Where cost fits
Fund selection and fund cost are separate questions, and the second one travels outside the TSP: what advice layered on top of any fund costs. If money leaves the TSP the whole cost structure changes with it — keeping the TSP versus rolling to an IRA. The withdrawal side is here, and the annuity option takes the money out of these funds permanently.
Sources
5 U.S.C. §8438 — subsections (b)(1) and (b)(2)-(b)(4) (fund definitions and index selection), (c)(2) (the target date default), (d) (elections), and (e) (the Government Securities Investment Fund obligations and their interest rate) — read at the Legal Information Institute on 2026-08-06. Quotations are from the statute.
Honest gap. This page is the statutory layer only. It does not name which index each fund currently tracks, does not give returns, expense ratios, allocations or any comparison between the funds, and — as set out above — does not repeat the G Fund principal claim, because the terms of issue that would support it were not read here. Anyone who needs the current index names, share prices or fund performance should take them from the TSP directly.
See methodology and corrections. General information about published law. This page contains no ratings, no allocation advice and no advertising, by design.