Abraham Grungold is a retired federal employee with over three decades of federal service. During this time, he worked with the USPS Inspector General, the VA Inspector General, the US Dept of Justice, and the US Dept of Labor. 

Through his company, AG Financial Services, he helps federal employees with their TSP and federal retirement planning and decisions. Now, Grungold is offering his unique insight into what he believes to be the two primary factors that prevent individuals from becoming as successful as they could be: fear and procrastination.

Preventing Yourself From Succeeding

According to statistics from April of 2024, there are nearly 117,000 Thrift Savings Plan (TSP) Millionaires for 6.9 active TSP plan participants. However, according to Grungold, that club would be substantially larger if it were not for fear and procrastination.

“It is an elite club that welcomes new members. The recipe to be a TSP millionaire is quite simple. There are two major ingredients: maximize your contributions and invest as aggressively as you can tolerate. Most important is that you need to be patient. Time is on your side if you are planning to have a 20-to-30-year federal career. Once you reach retirement, you can achieve this important milestone,” Grungold says.

There are approximately four million active federal employees. While they all strive to become TSP millionaires, many will not. The statistics are even more shocking when considered within the scope of the bigger picture: the 117,000 in the ‘club’ is less than two percent of all plan investors. So, why is this figure so small compared to the large scale of 6.9 million active TSP participants?

Grungold believes this is “due to two key behaviors that have nothing to do with the rise and fall of the stock markets: procrastination and fear. During my long career, I have worked at four different federal agencies, and I have heard the same thing over and over from co-workers regarding their TSP participation.”

Procrastination

Grungold repeatedly heard the same tales about why individuals were pushing off committing to their regularly scheduled donations. Whether they wanted to save for a house, pay off their school debts, or an upcoming wedding, the story was always the same: pushing off present-tense depositing in the name of saving it for some nebulous future date.  

Grungold states, “If you contribute five percent, the government gives you a five percent match. I would explain to co-workers that when they do not make their 5% contribution, it is like giving up a 5% matching bonus each year. This statement would always get their attention.”

Fear

Fear is the other factor preventing individuals from contributing. Grungold often heard from peers that they wanted their balance to stay the same, even one dollar, and would be fearful of depositing at all. Excuses were plentiful, from those claiming that the market might soon experience a recession to those saying that TSP funds were too volatile to be reliable.

“I completely understand their concerns,” Grungold says, “but many of my former co-workers fully understand the power of investing, and they still only choose the G fund. Investing your entire career in the G Fund will only provide you with a balance of approximately 250k. However, taking greater risk will generate bigger rewards.”

However, to Grungold’s point, the stock market rose to all-time highs many times during October 2024. He often speaks of the tremendous growth in the stock market and the profitability available to those who can overcome their fear and procrastination. 

“The TSP has a 35-year history of volatility. And I let my short-term fear cause me to make my decision to sell my C fund shares much too early. Certainly, I had no long-term plans to sell 100 percent of my C Fund holdings and transfer it all into the G fund. I will find opportunities to get back into the C Fund. I simply must be patient for these downward trends in the market to occur,” Grungold says.

Regarding your retirement, Grungold believes that procrastination and fear are the two greatest hindrances you will face. “If you can overcome these two traits of procrastination and fear, you will be a TSP millionaire sooner than you think,” he concludes.