An interfund transfer moves money you already have in your TSP account between funds. It is the only lever you have for repositioning your existing balance, and it comes with strict limits and deadlines that catch people at the worst possible moments. This page lays out the rules in plain English: how many moves you get, when the exception applies, what the deadline really means, and the mistakes we see most often.
A note on names. The TSP's current website calls these moves "reallocations" and "fund transfers." Most federal employees, and this site, still use the older term: interfund transfer, or IFT. The limits below apply to both kinds of moves combined.
Your first two IFTs in any calendar month can move money among any of the funds, in any combination, in any amount. The count resets on the first of each month. Unused moves do not carry over: two in January does not mean four in February.
Once you have used your two unrestricted moves, any additional IFT that month can only shift money toward the G Fund. This is the escape hatch: no matter what the market does late in a month, you can always reduce risk. You just cannot add it back until the month rolls over. That asymmetry is deliberate, and it is why the timing of each IFT matters so much. Spend both moves early in a month and your only remaining option is defense.
An IFT requested before 12:00 noon Eastern time on a business day is processed at that day's closing share prices. A request made after noon, or on a weekend or holiday, is processed at the next business day's closing prices. Either way, you never know the exact prices you will get when you submit; you are committing before the market closes.
The updated balance typically appears in your account the following business day. The move happened at the prior close; the display just lags.
This is the single most common point of confusion. Your TSP has two separate controls, and changing one does not touch the other. An interfund transfer repositions the money already in your account. Your contribution allocation (the TSP now calls this your "investment election") controls where future payroll contributions land. Move your whole balance to the G Fund and your next paycheck's contribution will still buy whatever your investment election says. If you intend to change course fully, you have to change both, and only the IFT counts against the two-per-month limit.
Say it is the 3rd of the month and you move your balance from the L 2040 Fund to 70% C and 30% G. That is IFT number one. On the 14th, you shift to 50% C, 20% S, 30% G. That is IFT number two. On the 22nd the market turns and you want back into a heavier stock position. You cannot. Until the 1st of next month, the only move available to you is toward the G Fund. If instead the market falls on the 22nd, you can still protect yourself: a move of any portion of your balance into G is always allowed.
Do IFT limits reset at the start of the month or 30 days after my last move? The start of the calendar month. Every participant's count resets on the 1st.
Does moving money into the G Fund after my two moves count against anything? No. Moves toward the G Fund after your two unrestricted IFTs are permitted and do not require anything special. You simply cannot move money out of G again until the new month.
Is there any cost to make an IFT? No. The TSP charges no transaction fee for transfers. The limits, not fees, are the constraint.
Do contribution allocation changes count against the two-per-month limit? No. Investment election changes for future contributions are unlimited and separate. Only moves of your existing balance count.
Rules summarized from tsp.gov and TSP participant materials. The TSP can change its rules and terminology; when in doubt, confirm against tsp.gov before acting. This page is education, not advice.