By law, the G Fund must be invested in non-marketable U.S. Treasury securities specially issued to the TSP, the retirement plan for 6.7 million federal employees and members of the uniformed services.
As of Dec. 31, 2021, the G Fund had $210.9 billion in assets, according to the TSP website. "The payment of G Fund principal and interest is guaranteed by the U.S. Government," the TSP website notes. "This means that the U.S. Government will always make the required payments."
A spokeswoman for the Federal Retirement Thrift Investment Board, which administers the TSP, could not immediately be reached for comment.
Also, Treasury expects to redeem existing, and suspend new, investments of the Civil Service Retirement and Disability Fund, or CSRDF, and the Postal Service Retiree Health Benefits Fund, Ms. Yellen said.
The CSRDF provides defined benefits to retired and disabled federal employees covered by the Civil Service Retirement System, which had $158 million in assets as of Sept. 30, 2021. The CSRDF is invested in special-issue Treasury securities, which count against the debt limit, according to information on the Treasury's website.
The three funds will be "made whole" after the debt limit impasse has ended, Ms. Yellen said.
A spokeswoman for the Federal Retirement Thrift Investment Board, which administers the TSP, could not immediately be reached for comment.
Mr. Yellen warned that the government's outstanding debt is projected to hit statutory limit on Jan. 19 and Treasury may be out of options come June.
"While Treasury is not currently able to provide an estimate of how long extraordinary measures will enable us to continue to pay the government's obligations, it is unlikely that cash and extraordinary measures will be exhausted before early June," Ms. Yellen said.
Some House Republicans have signaled that they'd like to enact spending cuts in order to raise the debt ceiling. Raising the debt ceiling, which is a cap on the money the U.S. government can borrow to pay its bills, does not authorize any new spending.
At a press briefing Friday, White House Press Secretary Karine Jean-Pierre said raising the debt ceiling "should not be a political football. This is not political gamesmanship, and this should be done without conditions."
In her letter to congressional leaders, Ms. Yellen urged Congress "to act promptly to protect the full faith and credit of the United States."