The Thrift Savings Plan (TSP) has shattered records, closing 2025 with an unprecedented $1.07 trillion in total assets. As reported by FEDweek, this surge was fueled by a roaring bull market that lifted balances across the board.
However, buried in the celebration of these gains is a critical warning sign for federal employees—especially those nearing retirement. The same market rally that boosted your balance has likely skewed your risk profile, making your portfolio significantly more aggressive than you intended.
📈 Sound Data: The “Millionaire Club” Explosion
To understand the magnitude of 2025’s market run, look no further than the “TSP Millionaire Club.”
- New Members: The number of TSP millionaires surged by nearly 24% in 2025, jumping from roughly 157,760 to 194,722 by year-end.
- The Drivers: This growth wasn’t just savings; it was powered by exceptional fund performance.
- I Fund (International): +32.45% (The year’s top performer)
- C Fund (Large Cap): +17.85%
- S Fund (Small Cap): +11.38%
⚠️ The Hidden Risk: “Portfolio Drift”
While high returns are great, they create a phenomenon called Portfolio Drift. Because stocks (C, S, and I Funds) grew much faster than bonds (F and G Funds), stocks now take up a much larger slice of your pie.
Data of the Shift:
- G Fund Decline: The share of total TSP assets held in the G Fund dropped from 29.8% to 26.6%.
- C Fund Rise: Meanwhile, the C Fund’s share of total assets swelled from 32.8% to 35.8%.
Why This Matters: If you started the year with a balanced 60/40 split (60% Stocks / 40% Bonds) to protect your nest egg, the market rally may have shifted you to a 70/30 split without you lifting a finger. You are now taking on more risk just as market valuations are hitting record highs. If the market corrects in 2026, your exposure to loss is higher than you planned.
🛡️ Don’t Let Success Become a Liability
A record-high balance is the perfect time to audit your strategy, not ignore it. The goal is to buy low and sell high—rebalancing does exactly that by skimming profits from your winners (I and C Funds) and securing them in stable assets.
This is where Internal Benefit Advisors serves as your strategic partner. We help you “lock in” this year’s victory.
How We Help You Rebalance:
- Risk Tolerance Audit: We analyze your current allocation against your retirement timeline. Are you “accidentally” aggressive just two years before retirement?
- Rebalancing Strategy: We help you mathematically realign your portfolio to your target percentages, effectively selling high (I Fund) to buy low (F or G Fund), ensuring you capture the gains before volatility returns.
- Contribution Review: We adjust your future contributions to maintain this balance automatically, so you don’t have to manually trade every month.
You made the money. Now make sure you keep it.
Contact Internal Benefit Advisors today for a portfolio risk assessment and rebalancing review.
References
- FEDweek. “TSP Closes 2025 at $1.07 Trillion; Stock Gains Making Holdings More Aggressive.” January 15, 2026.
- FEDweek. “TSP Millionaire Count Nears 200,000.” January 13, 2026.
- Internal Benefit Advisors. Retrieved from https://internalbenefitadvisors.com
