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THRIFT INVESTMENT BOARD RELEASES SURVEY RESULTS

     Washington, D.C. (January 16, 2007) — The Federal Retirement Thrift Investment Board today released the results of a survey conducted by Watson Wyatt Worldwide, an independent consultancy, to study the opinions of Federal employees with regard to their needs, attitudes, understanding, and satisfaction with the Thrift Savings Plan (TSP) for Federal employees.  The survey was also designed to gauge participants’ reactions to some potential changes to the TSP that are under consideration.  The survey was conducted in November 2006 through a paper-based mailing to the homes of a random sample of Federal workers and uniformed service members.

     The key findings of the survey include:

• TSP participants are generally more satisfied with the plan than comparable employees in the private sector are with their 401(k) plans.

• TSP participants are satisfied with the administration of the plan and find the web-based information provided by the TSP as critical for building program understanding and financial literacy. Those who make use of this information exhibit significantly different investment behavior in their TSP account.

• Federal workers and uniformed service members identify their TSP account as a cornerstone of their future retirement income.

• Federal Employees’ Retirement System (FERS) members identify matching contributions as a key reason why they participate in the TSP program while Civil Service Retirement System (CSRS) employees note tax benefits as their primary motivation for contributing.

• TSP participants are generally in favor of automatic enrollment of new Federal employees and uniformed service members in the TSP program.

• TSP participants believe that adding a Roth 401(k) option to the program will make it a better program. This sentiment is particularly strong among uniformed service members.

• TSP participants generally favor adding additional investment options to the TSP. However, they are very price sensitive to adding specific investment options, preferring to add options only if they cost the same as existing funds. The strongest support for a new fund option is for a TIPS Fund.

    The results of the survey can be statistically generalized at the overall Plan level with a margin of error of less than plus or minus two percent.  The survey responses for the component groups eligible to participate (CSRS and FERS employees, and members of the uniformed services) have a margin of error of ±3 percentage points.  While data on certain age groups is included in this report for descriptive purposes, these findings must be viewed as preliminary and tentative until the on-going additional data collection effort has been completed.  Results comparing behavior of certain age and salary groups should be available in about three months.

     The TSP is a retirement savings plan for Federal employees and members of the uniformed services. It is similar to the 401(k) plans offered by many private employers.  It was created by the Federal Employees' Retirement System Act of 1986.  As of December 31, 2006, TSP assets totaled approximately $206 billion, and retirement savings accounts have been established for more than 3.7 million participants.   

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