Thrift Savings Plan (TSP)
Learn about the fundamentals of the Thrift Savings Plan for federal employees. Explore fund choices, contribution strategies, and optimize long-term growth with skilled financial guidance.
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What is the Meaning of a Thrift Savings Plan?
A cornerstone retirement accumulation account for civilian federal workers and uniformed service members.
The Thrift Savings Plan (TSP) was established as a core pillar of the Federal Employees Retirement System (FERS) under the Federal Employees' Retirement System Act of 1986. Modeled closely after corporate 401(k) plans, the TSP provides federal employees and military service members with tax-advantaged retirement accumulation with ultra-low administrative fees overseen by the Federal Retirement Thrift Investment Board (FRTIB).
The TSP serves as the defined contribution leg of your federal three-tiered retirement system (alongside your FERS Basic Annuity pension and Social Security). Making knowledgeable asset allocation decisions and securing full agency matching contributions can significantly impact your net retirement income.
Savings for Retirement
Invest in long-term TSP savings options to boost your retirement nest egg alongside Social Security and your FERS annuity pension.
Tax-Exempt & Tax-Deferred Options
Choose between Traditional TSP (pre-tax contributions lowering current taxable income) and Roth TSP (after-tax contributions yielding tax-free withdrawals in retirement).
Negligible Administrative Costs
Benefit from institutional index tracking with expense ratios among the lowest in the entire world financial market.
Full 5% Government Agency Match
Never leave money on the table: the federal government automatically provides an immediate 1% contribution plus up to a 4% dollar-for-dollar agency match on employee contributions.
Fund Transfer Flexibility
Eligible for direct penalty-free rollovers into Traditional or Roth IRAs, or consolidation from previous employer 401(k) and 403(b) accounts into the TSP.
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TSP Investment Funds & Performance
Diversify your retirement portfolio across the 5 core individual index funds or hands-off Lifecycle (L) target date funds.
G Fund (Government Securities)
Principal Protection & Capital Preservation
Invests in specially issued U.S. Treasury securities guaranteed by the full faith and credit of the United States. Yields interest without market volatility risk.
F Fund (Fixed Income Index)
Broad U.S. Bond Market Exposure
Tracks the Bloomberg U.S. Aggregate Bond Index. Offers bond income diversification through government, corporate, and mortgage-backed bonds.
C Fund (Common Stock Index)
Large-Cap U.S. Equities (S&P 500)
Replicates the performance of the S&P 500 Index, holding shares in the 500 largest publicly traded corporations in the United States.
S Fund (Small-Cap Stock Index)
Mid & Small-Cap Growth Companies
Tracks the Dow Jones U.S. Completion Total Stock Market Index, capturing medium and small U.S. businesses not included in the S&P 500.
I Fund (International Stock Index)
Developed & Emerging Global Markets
Tracks international equity markets across Europe, Australasia, the Far East, and emerging countries for international economic growth exposure.
L Funds (Lifecycle Funds)
Automated Target-Date Portfolios
Professionally balanced portfolios that automatically reallocate toward conservative funds (G and F) as you approach your planned retirement date.
TSP Account Management
Essential administrative protocols to maintain throughout your federal career.
Manage & Update Your Online TSP
Learn to navigate the modernized TSP portal, adjust monthly contribution percentages, and initiate investment reallocations with confidence.
Keep Personal Details Up-to-Date
Ensure your federal agency, mailing address, contact information, and service tenure are accurately logged to avoid delayed retirement payouts.
Designate Valid Beneficiaries
Critical step: Designating and reviewing your primary and contingent TSP beneficiaries (Form TSP-3) ensures your savings transfer directly to your loved ones without probate.
Services for TSP Participants
Get specialized assistance from our independent financial educators to unlock federal benefits and maximize your investment accumulation.
Want to Discuss?
Call us today to discuss your federal options or schedule a one-on-one session with an advisor.
Frequently Asked Questions
Clear answers to the most common questions federal employees ask regarding this service.
Federal employees can contribute up to the IRS elective deferral limit ($23,000 for standard contributions, plus an additional $7,500 in catch-up contributions for employees aged 50 or older, with special enhanced catch-up limits under SECURE 2.0 for ages 60–63).
Traditional TSP contributions are made pre-tax, lowering your current year taxable income, but withdrawals in retirement are taxed as ordinary income. Roth TSP contributions are made after-tax, meaning your contributions and accumulated earnings grow tax-free and can be withdrawn completely tax-free in retirement if qualifications are met.
Yes. Active federal employees can take General Purpose loans (up to 5-year repayment) or Primary Residence loans (up to 15-year repayment) for up to 50% of their vested balance or $50,000 (whichever is less). However, unpaid balances upon separation from service become taxable distributions.
You have multiple options: You can leave your funds invested in the TSP, set up installment payments, purchase a life annuity, or complete a direct rollover into a Traditional or Roth IRA without tax penalties.
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