How to Get Back Into the Market After Moving to the G Fund

If you’ve recently panicked and moved all (or most) of your TSP into the G Fund, you’re not alone. When markets take a dive or the headlines scream bad news, it’s easy to feel like the safest option is moving to the sidelines. 

But here’s the challenge: Once you’re out, the hard part is figuring out when—and how— to get back in. 

Let’s take a look at why timing the market is dangerous, the risks of staying too long in the G Fund, and the practical steps you can take right now to rebuild your strategy. 

Why Federal Employees Move to the G Fund

There are several common reasons federal employees might shift to the G fund: 

• A big market drop makes you nervous. 
• The business channels predict doom. 
• You don’t want to lose the retirement dollars you’ve worked so hard for. 

So, you shift to the G Fund or F Fund to “wait things out.” 

On the surface, this feels smart. But it’s actually a form of market timing—and that comes with some serious pitfalls. 

If you aren’t familiar with the term, market timing means trying to predict the best times to buy or sell stocks based on where you think the market is going. It might sound a bit like gambling—and that’s because it often is. 

The Problem with Market Timing 

Here’s the reality: To successfully time the market, you need to be right twice—once when you get out, and again when you get back in.Timing matters because getting back into the market when stocks are already high can delay your growth for years. The real opportunity? It’s when prices are low—what I like to call buying stocks “on sale.” That’s when investors set themselves up for the greatest gains—if they time it right. 

But that’s extremely difficult, even for Wall Street pros. In fact: 

• Analysts with decades of experience and seven-figure salaries get it wrong more than 25% of the time. 
• Many investors who “play it safe” by exiting the market end up missing the rebound, which often comes faster than they expected. 

It’s like trying to join a dance after the music’s already started—you’ll always feel a step behind. 

What to Do If You’ve Already Moved Into the G Fund

If you’ve panicked and shifted a large portion—or even 100%—of your TSP balance into the G Fund, here are the steps to consider now: 

1. Track Valuation Tools

Use indicators like the Shiller P/E Ratio to gauge whether the market is overvalued or undervalued. This long-term valuation metric helps investors see whether stocks are priced higher or lower than historical averages. 

• When it dips close to 30 or below, that may be a sign to begin re-entering equities. 
• This isn’t the only tool, but it’s one of many helpful markers to watch. 

2. Dollar Cost Average Back In 

Instead of trying to jump back in all at once, use Dollar Cost Averaging (DCA): 

• Move 5%–10% of your funds back into C, S, and I at regular intervals. 
• This spreads out your risk and reduces the pressure of timing the “perfect day.” 
• Consider working with a financial advisor who can align this phased approach with your risk tolerance and retirement goals. 

3. Remember: Inflation Is the Real Enemy 

Sitting in the G Fund long-term might feel safe, but inflation quietly erodes your purchasing power. Over time, this can be just as damaging—if not more—than market swings. 

Think of it like merging back onto the highway: It’s intimidating, but staying on the shoulder forever isn’t an option if you want to reach your retirement destination. 

A Bonus Check: The Buffett Indicator 

Another tool you can use is the Buffett Indicator, which compares the size of the U.S. economy (GDP) to the total stock market value. 

• When the market value is 1.5 to 2 times GDP, that suggests overvaluation. 
• Use it as a second checkpoint as you plan your re-entry strategy. 

Final Perspective — Don’t Let Fear Derail Your Future

Here’s something to keep in mind: 

“Armageddon only happens once.” 

If the sky truly falls, the G Fund won’t protect your retirement either. But history shows that markets recover—and those who stay invested (or get back in early) benefit the most. 

If you’re unsure how to shift back into the market wisely, my team at SWAN Capital is here to help. We specialize in retirement planning for federal employees, and we’d be happy to meet with you one-on-one and create a personalized strategy to help you plan with confidence. 

If you have federal retirement questions we haven’t answered, email us at info@swan-capital.com. Feel free to check out our other resources, including videos and free guides including “How to Double Your TSP” and “Should You Use Your TSP to Pay Off Your Mortgage.”

Ready to see how your TSP stacks up?

Text SWAN to 1-800-848-8768 for a free Federal Retirement Report, or schedule a complimentary consultation now!

COVERING OUR TAIL FEATHERS

Welcome to Swan Capital, LLC (“SWAN”), your friendly neighborhood Registered Investment Adviser (“RIA”). Now, while we may have a fancy title, remember that our registration doesn’t guarantee we’re flying high above the rest. This communication hasn’t been blessed or verified by the United States Securities and Exchange Commission (SEC) or any state securities authority. At SWAN, we believe in giving you personalized investment advice as unique as a swan’s graceful glide. We work with clients in their own states, making sure to play by all the regulatory rules or find the right exceptions. But here’s the scoop: all investments come with risks—like a wild swim in the pond—so no investment strategy can promise profits or protect you from the occasional splashdown. Just remember, past performance is like a cozy old story; it might be nice to reminisce about, but it doesn’t promise what’s coming next. 

SWAN Capital, LLC is an independent firm and is not affiliated with, endorsed by, or sponsored by the Federal Employee Retirement System (FERS) or any government agency. 

Thanks for gliding along with us at SWAN! We’re here to help you soar to new financial heights while ensuring you can truly Sleep Well At Night!