Definition of thrift savings plan (TSP)
- It is a kind of retirement investment programme.
- It is a defined contribution scheme that is available to Federal Employees of the United States.
- Benefits derived from TSP include automatic payroll contributions and agency matching contributions.
Funds that One Can Invest in for TSP
- Government Securities Investment (G) Fund,
- Fixed-Income Index Investment (F) Fund,
- Common-Stock Index Investment (C) Fund,
- Small-Capitalisation Stock Index Investment (S) Fund,
- International-Stock Index Investment (I) Fund,
- Specific life-cycle (L) funds.
Eligibility Criteria
- The employee must be working full- or part-time in either of the following capacities –
- FERS employee (hired on or after January 1, 1984)
- CSRS employee (hired before January 1, 1984 and did not convert to FERS)
- Member of the uniformed services under active duty or Ready Reserve
- Civilian in certain other categories of government service
- Must be in a pay status in order to contribute to the TSP.
How Does It Work?
- The individual in question is to use his or her agency’s electronic payroll system to start, change, or stop his or her TSP contributions.
- He or she will receive annual and quarterly statements of the account activity regarding adjustments, deferrals, forfeitures etc.
- Federal Retirement Thrift Investment Board is the independent federal government agency that administers the TSP.
- One has the option of requesting loans from this account too and it will be processed offline and not electronically.
