TSP - delay in deposts from paycheck?

[WM]

I recently set up a TSP account for DH, and was checking to make sure the auto-deposits were working ok.

I signed up in Jan, and it said it would start witholding $ from paychecks in Feb, which it did - both paychecks (middle and end of month) were reduced.

But the $ didn't get deposited into his new TSP account until 1 March - what's up with that? Where is it going between when it's taken out of the paycheck and when it's deposited into the TSP?

I know, this is quibbling, it's a small amount of money we're talking about, but it's annoying. Someone is obviously getting use of it - is this why the expenses are so low?

Or am I missing something?

 

[Nords]

But the $ didn't get deposited into his new TSP account until 1 March - what's up with that? Where is it going between when it's taken out of the paycheck and when it's deposited into the TSP?
I know, this is quibbling, it's a small amount of money we're talking about, but it's annoying. Someone is obviously getting use of it - is this why the expenses are so low?
Or am I missing something?

Well, FWIW it's not sloshing around in some bureaucrat's office exploiting the interest-rate float-- it didn't exist to begin with. The "money" deducted from your paycheck is no more real than the funds in the Social Security lockbox.

The govt computers give you some money out of the Treasury on 1 Feb. (You can cash that check.) On 1 Mar they give a little more to the TSP under your name. (The TSP can't do anything with it until 1 Mar.) The govt is paying its obligations at the last possible minute. The govt bean counters stripped all the excess funds away from this process years ago and it's programmed into the accounting and the cash flows.

It may be annoying but there's not a better game in town. The expenses are so low because there's a huge predictable cash flow being deposited every month (just not the month you expect!) and also a highly predictable outflow. Churning Trading is negligible. Once you decide to participate you have very little choice or flexibility so the cost of doing business is very low. The govt is also one of the world's largest, if not THE largest, institutional investors. If they don't want to pay a couple extra basis points for the bonds in the "G" funds then they don't have to. Like Vinson said, "A billion here, a billion there, pretty soon you're talking real money."

If Vanguard tried to run their funds in such an autocratic & authoritarian manner then Jack Bogle wouldn't have been able to quit his day job. No one would have given him enough money to buy the TSP's 800-pound gorilla, let alone feed it.

Spouse has 92% of her Reserve paycheck deposited to the TSP's "S" fund. Although she does have to pay taxes on the last 8%, 7.45% is deducted for Social Security & Medicare to leave her with 0.55% take-home pay. It's pretty amusing to watch an entire drill weekend dump $3.98 in her checking account...

 

[martyb]

You might try posting your question at www.federalsoup.com if you don't get any good answers here. That's an all-federal employee/retiree site, with several active & former human resources experts that are members.

 

[martyb]

OK, I stand corrected....Nords has some good info. Still, the Federal Soup site is a good place for federal employment related info. Lot's of coverage of civilian & military TSP info over there.

Marty

 

[Nords]

OK, I stand corrected....Nords has some good info. Still, the Federal Soup site is a good place for federal employment related info. Lot's of coverage of civilian & military TSP info over there.

Yep, those guys are a lot smarter than anything you'll read on the military side. And when they're both veterans and civil servants then they've seen it all.

I still haven't figured out what spouse should do with the TSP when she's ready to make a retirement decision.

 

[WM]

Thanks for the info, and the federalsoup link - I'll check it out.

I agree the TSP is still a great deal (especially if you can deposit your whole check into it!), this was more just an unexpected "glitch" that had me wondering.

 

[kaudrey]

That's weird to me. My TSP deposits show up every two weeks, consistent with my paychecks.

 

[WM]

That's weird to me. My TSP deposits show up every two weeks, consistent with my paychecks.

Odd. Are you a civilian employee? DH is military, so maybe the system is slightly different?

 

[Fireup2020]

No problems here - hits my TSP account on USNR "payday" - all 90% I think I end up with maybe $10 into my checking account - lol

 

[Nords]

But the $ didn't get deposited into his new TSP account until 1 March - what's up with that?

That's weird to me. My TSP deposits show up every two weeks, consistent with my paychecks.

No problems here - hits my TSP account on USNR "payday" - all 90% I think I end up with maybe $10 into my checking account - lol

OK, you made me look. My spouse's TSP contributions hit the TSP the same day her Reserve EFT hits her checking account. (Incidentally last quarter's statement is now available.) But when I was active duty five years ago I'm pretty sure my TSP contributions lagged my paychecks by a month, just like WM is seeing now.

I suspect we're dealing with at least three separate pay systems here-- federal civil service, active duty, and Reserves. I remember in the 1990s a military payday was once shifted from 30 Sep to 1 Oct to save several millions of budget money across fiscal years, so I can believe that TSP contributions are subject to the same sort of timing games.

"Joint" indeed...

 

[martyb]

I'm a civilian employee, and a reservist too. Back when I was putting money into both TSP's at the same time, but not maxing either one out :, both deposits went into my accounts on payday. I'm not sure what's causing the delay you're experiencing.

 

[Nords]

I'm a civilian employee, and a reservist too. Back when I was putting money into both TSP's at the same time, but not maxing either one out :, both deposits went into my accounts on payday. I'm not sure what's causing the delay you're experiencing.

Now we need to hear from the rest of the active duty folks.

(Thunk-thunk) Hello? Is this thing on?!

 

[kaudrey]

Odd. Are you a civilian employee? DH is military, so maybe the system is slightly different?

----

Yes, I'm civilian, but apparently from the other responses, that shouldn't matter.

Karen