Retirement funds bounce back in July

After two very tough months, TSP participants likely are breathing a sigh of relief at the July returns; all 10 funds saw gains in July.

The I Fund, which invests in overseas companies, rebounded in July, gaining 10.78 percent. That followed months of losses, most notably an 11.2 percent drop in May. Despite the gain, the fund remains down 4.81 percent this year to date.

Both the S Fund, which invests in small and mid-size companies and tracks the Dow Jones Wilshire 4500 Index, and the C Fund, invested in common stocks of large companies on the Standard & Poor's 500 Index, showed about 7 percent returns in July.

These gains reversed trends from May and June. In June, the S and C funds lost 6.9 percent and 5.24 percent, respectively. The S Fund is up 6.15 percent this year to date, while the C Fund is still down slightly for the year, with losses of 0.11 percent.

The F Fund, invested in fixed-income bonds, saw a 1.07 percent increase in July, below the 1.56 percent growth posted in June. The government securities (G) fund, TSP's most stable offering, earned 0.23 percent in July, almost identical to June's 0.24 percent gain.

The life-cycle funds, designed to shift investors from a more aggressive portfolio earlier in their careers to more stable investments as they near retirement, made small gains in July. The funds had struggled in May and June, each posting losses in those months.

All five life-cycle funds are up for the year. The L Income Fund, for people who have reached their target retirement date and are withdrawing money from their TSP accounts monthly, has gained 1.89 percent so far this year; the L 2010, 1.81 percent; the L 2020, 1.22 percent; the L 2030, 1.1 percent; and the L 2040, 0.94 percent.