Saving for your retirement has many advantages.

  • Traditional (pre-tax) or Roth (after-tax) Contributions: Traditional contributions come out of your pay before tax, and investment earnings are tax-deferred. Roth contributions come out of your pay after-tax and are tax-free when withdrawn. Earnings on Roth contributions are paid tax-free when withdrawn as long as certain IRS rules are met.
  • Minimal Cost: You pay very low administrative and investment expenses.
  • Agency Automatic Contributions: If you are covered by FERS, you automatically receive 1% of your basic pay from your agency each pay period. You get these contributions whether or not you contribute to the TSP from your own pay.
  • Matching Contributions: If you are covered by FERS and you contribute 5% of your basic pay to the TSP each pay period, your agency will contribute an additional 4% of your basic pay to your TSP account.
  • Catch-Up Contributions: If you are age 50 or older, you can contribute an amount that exceeds the elective deferral limit.
  • Multiple Fund Investment Options: You have a choice of diversified investment funds or you can select from professionally designed lifecycle funds.
  • Transfer Other Employee Plans Into TSP: If you already have tax-deferred money in a traditional IRA or another eligible employer plan, you can transfer those accounts into your TSP. You may also transfer in Roth money from an eligible employer plan.
  • Loans: Under certain circumstances, you may be eligible to borrow from your account.
  • In-Service Withdrawals: Under certain circumstances, you may be eligible to access your TSP savings while you are still employed by the Federal Government.
  • Multiple Withdrawal Options: You have a variety of withdrawal options when you leave Federal service.