This article by Jim Absher originally appeared on Military.com, the premier resource for the military and veteran community. 

On July 1, the Thrift Savings Plan (TSP) will add six new funds and retire one, giving participants a total of 15 options of how to invest their retirement savings.

The TSP will add six more lifecycle or "L funds" to its mix of ways you can invest your retirement plan contributions. The L funds are designed to let investors balance risk and returns on their portfolio of TSP holdings as their career progresses toward retirement

Generally, financial experts recommend investing in lower-yield, but less risky, investments as you get closer to retirement age. This is because if you lose one-third of your investment due to a market turndown, as many people did earlier this year, it may take years to recover.

Normally, younger investors can make up market losses over time; however, older investors don't have that luxury.

Younger investors benefit from greater returns early in their career, since their investment growth is compounded over time.

[RELATED: To SBP, or Not to SBP? Evaluating Your Survivor Benefit Plan Option at Retirement]

TSP participants can choose to invest their money in five main funds:

• The G Fund. This fund invests in government securities and is the safest option. You won't lose money investing in this fund, but your rate of return is the lowest.
  
  
• The F Fund. This fund invests in U.S. government, mortgage-backed, corporate and foreign government bonds. Your risk is fairly low, but your rate of return is too. Usually, when stock markets go down, bonds go up in value.
  
  
• The C Fund. This fund invests in the stock market. The stocks are made up of the Standard and Poor's 500 (S&P 500) Index, a mix of stocks of 500 large to medium-sized U.S. companies. If the stock market goes up, you can make money. If it goes down, you can lose money. The risk is still higher than the F fund, but the rate of return is higher too.
  
  
• The S Fund. This fund invests in the stock market too. But instead of big companies, it invests in smaller companies that aren't in the S&P 500. The risk is still higher than the C fund, but the rate of return is higher.
  
  
• The I Fund. This fund invests in international stock markets. This is the riskiest fund.
  
  

To make it easier for participants to reallocate their investments as they work toward retirement, the TSP created the L funds, which consist of varying combinations of these five main funds. There are currently five L funds with different retirement target dates. These funds automatically adjust their holdings to become more conservative as the target retirement date nears.

[RELATED: So You’ve Decided to Become an ‘Investor’]

These funds are great for the type of investor who wants to just "set it and forget it." They save the casual investor, who may be deployed or otherwise unable to pay daily attention to their investment mix, the hassle of rebalancing their investments every three months, as the TSP does.

These types of investment funds are also known as "target-date" funds, since they reallocate your investments on a regular basis based on your retirement target date.

Effective July 1, 2020, the TSP will have the following L funds:

• The L 2025 Fund. Recommended for those who were born between 1958 and 1964 and plan to begin withdrawing from their TSP account between 2021 and 2027.
  
  
• The L 2030 Fund. Recommended for those who were born between 1965 and 1969 and plan to begin withdrawing from their TSP account between 2028 and 2032.
  
  
• The L 2035 Fund. Recommended for those who were born between 1970 and 1974 and plan to begin withdrawing from their TSP account between 2033 and 2037.
  
  
• The L 2040 Fund. Recommended for those who were born between 1975 and 1979 and plan to begin withdrawing from their TSP account between 2038 and 2042.
  
  
• The L 2045 Fund. Recommended for those who were born between 1980 and 1984 and plan to begin withdrawing from their TSP account between 2043 and 2047.
  
  
• The L 2050 Fund. Recommended for those who were born between 1985 and 1989 and plan to begin withdrawing from their TSP account between 2048 and 2052.
  
  
• The L 2055 Fund. Recommended for those who were born between 1990 and 1994 and plan to begin withdrawing from their TSP account between 2053 and 2057.
  
  
• The L 2060 Fund. Recommended for those who were born between 1995 and 1999 and plan to begin withdrawing from their TSP account between 2058 and 2062.
  
  
• The L 2065 Fund. Recommended for those who were born after 1999 and plan to begin withdrawing from their TSP account after 2062.
  
  
• The L Income Fund. It is recommended for those who were born before 1958 and are already withdrawing money from their TSP account.
  
  

The July 1 changes remove the L 2020 fund and add funds with target retirement dates after 2050, as well as the new 2025, 2035, etc. funds.

Previously, the L funds were divided by 10-year intervals instead of five-year intervals. This new, more specific division of funds allows participants to fine-tune their investment strategy to make the most of their TSP investment while keeping their money safe and not having to worry about readjusting their investment mix on a regular basis.

Many TSP participants, especially those newer to the plan, were invested automatically into the L Fund most appropriate for their age.

Those wishing to make changes to their investment fund will need to log in to the TSP website after July 1 to do so.

More articles from Military.com:

16 West Point Cadets Test Positive for COVID-19 upon Returning for Commencement Speech

Guard Soldier Killed in Shootout While Assisting Fellow Law Enforcement Officers

2,000 Marines from Southern California Deploy to the Middle East as Crisis Response Force