THRIFT SAVINGS PLAN (TSP)
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FERS
If you’re covered by the Federal Employees’ Retirement System (FERS), the TSP is one part of a three-part retirement package that also includes your FERS basic annuity and Social Security. |
CSRS
If you’re covered by the Civil Service Retirement System (CSRS) or are a member of the uniformed services, the TSP is a supplement to your CSRS annuity or military retired pay |
What is it?
Like private sector 401(k) plans, TSP is a government-sponsored defined contribution investment instrument. It is another potential retirement income stream for federal workers enrolled in the Federal Employees Retirement System (FERS) and, the now nearly legacy pension plan from 1920, the Civil Service Retirement System (CSRS). They are both defined benefit pension plans, offering annuities upon retirement.
Investment Options -
Like private sector 401(k) plans, TSP is a government-sponsored defined contribution investment instrument. It is another potential retirement income stream for federal workers enrolled in the Federal Employees Retirement System (FERS) and, the now nearly legacy pension plan from 1920, the Civil Service Retirement System (CSRS). They are both defined benefit pension plans, offering annuities upon retirement.
Investment Options -
- Some are risky but offer a more generous return on your investment if the fund is performing well.
- Others are more conservative investments. But they tend to achieve greater stability and predictable — yet potentially not as generous — returns.
In-service withdrawal basics
In-service withdrawals are withdrawals you make from your TSP account while you’re still working for the federal government or a member of the uniformed services. An in-service withdrawal can have a serious impact on your TSP account. Remember that the purpose of your account is to accumulate savings so that you’ll have income during retirement.
Things to consider:
By law, we can’t pick your plan. But we can review your options. We also may recommend positioning you away from the TSP at some point, because of severe restrictions with the plan that come into effect when you decide to retire. Depending on your goals and financial situation, we may recommend other financial products that could optimize the investment you have made into your TSP.
In-service withdrawals are withdrawals you make from your TSP account while you’re still working for the federal government or a member of the uniformed services. An in-service withdrawal can have a serious impact on your TSP account. Remember that the purpose of your account is to accumulate savings so that you’ll have income during retirement.
Things to consider:
- Withdrawals permanently reduce your retirement savings as well as any earnings you would’ve earned.
- Withdrawals may be subject to income taxes or other penalties.
- If you’re a married FERS participant or a member of the uniformed services, your spouse must sign a consent waiver for your in-service withdrawal.
By law, we can’t pick your plan. But we can review your options. We also may recommend positioning you away from the TSP at some point, because of severe restrictions with the plan that come into effect when you decide to retire. Depending on your goals and financial situation, we may recommend other financial products that could optimize the investment you have made into your TSP.
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