Republican budget would take $32 billion from your TSP retirement savings

The Republicans slipped a little surprise for postal and federal workers into their recent budget proposal- essentially making the TSPs’ G Fund worthless, according to the Washington Post’s Joe Davidson:

Among the policy retreads, there was a surprise in the House package.

Republicans want to make the most popular employee investment fund in the Thrift Savings Plan (TSP) worthless. To save $32 billion over 10 years, House Republicans propose changing the fund’s interest-rate calculation, because, the resolution says, “those who participate in the G Fund are rewarded with a long-term rate on what is essentially a short-term security.”

Going after the TSP “is a new one,” said Kim Weaver, a TSP spokeswoman who has seen “nothing like this before.”

The savings for Uncle Sam would come at a great cost to his staff.

The fund’s current annualized interest rate is 1.88 percent. Adopting the House plan would result in a precipitous interest-rate drop to an annualized 0.01 percent, according to the TSP.

Read more: GOP budget plan has a surprise among list of cuts for federal employees – The Washington Post.