The House Oversight and Government Reform Committee on Wednesday passed legislation to make lifecycle funds the default investment for new federal employees participating in the $366.7 billion Thrift Savings Plan, Washington.
H.R. 4193, the Smart Savings Act, introduced by committee Chairman Darrell Issa, R-Calif., would make the default option the five lifecycle funds known as the L Funds, started in 2005. The current default option is the G Fund, an internally managed government securities fund that accounts for 43% of TSP assets.
The measure, which has bipartisan support, “will enable workers to take full advantage of a diversified fund designed to yield higher returns,” said ranking member Elijah Cummings, D-Md., in a statement.
Officials at the Federal Retirement Thrift Investment Board which administers the TSP, asked for the legislative authority to change the default for new federal employees.
Similar bipartisan legislation has been introduced in the Senate by Sens. Elizabeth Warren, D-Mass., and Rob Portman, R-Ohio.