FERSTSP GUIDE

NOW AVAILABLE FOR ALL TSP ACCOUNT HOLDERS!

TSP - LOANS

Taking Advantage of 2-factor Authentication on Your TSP Account: Enabling two-step authentication helps you protect your account against fraud. This login process is more secure because it means that online access to your account requires something you know (your account number or username and password) and something you receive (the one-time code you receive in your email or on your phone). Someone who tries to log into your account fraudulently won’t be able to gain access without the code.

To set it up, account holders must enter an email address or cell phone number in their profile settings in the My Account feature on tsp.gov.

New Rules Took Effect September 15, 2019.

Age-based withdrawals: Up to four age-based withdrawals per year are allowed for employees who have attained the age of 59 ½. Taking an age-based withdrawal will no longer preclude the participant from taking a partial withdrawal when separated.

Partial withdrawals when separated: Whether or not a separated participant has taken an age based withdrawal (or withdrawals) while working, there is no limit to the number of partial withdrawals they can take, as long as they are not taken more often than every thirty days.

Installment payments: Installment payments can be taken monthly, quarterly or annually. The amount and frequency of installment payments can be changed at any time. Payments can be stopped and start-ed at any time. Taking installment payments will not preclude one from taking partial withdrawals.

Proportional withdrawals are no longer required: Individuals will have the option of choosing from which balance (traditional or Roth) they want their withdrawals to come.

General Purpose Loan: 1-5 years to repay - requires no documentationResidential Loan: 1-15 years to repay - requires documentation that the property will be your primary residence. May use for construction of primary residence. - Apply Online or Paper Application (TSP-20).- Current Interest Rate: .875% (April 2020, changes monthly)- Amounts You Can Borrow: Must borrow at least $1,000 50% of current veted balance up to $50,000

AT RETIREMENT, YOU MAY CHOOSE TO:

2020 CONTRIBUTION LIMITS

AS OF 1/31/2020

ADVANTAGES OF USING TSP

LIFECYCLE FUNDS

Allocation as of April 2020

- Receive TSP monthly payments (you can change the dollar amount as often as every 30 days)- Elect a lifetime annuity- Make a partial withdrawal of your TSP account - Make a full withdrawal of your TSP account; OR any combination of the four options

- Only 90% of FERS employees participate and of those... 25% contribute less than 5% and lose matching funds! - Largest defined contribution plan in the world with $631* Billion in assets (of which $18.6 Billion is Roth TSP)

- Choice of tax treatments between Traditional (pre-tax) and Roth (after tax) contributions- Automatic payroll deduction makes saving easier- A diversified choice of investment options - Low Fees

The L Funds provide you with a convenient way to diversify your account among the G, F, C, S, and I Funds, using professionally determined investment mixes that are tailored to different time horizons. Your “time horizon” is the date (when you leave Federal service) that you think you will need the money in your TSP account.

Fees - Administrative fees for 2019 were .042% of the account balance or= $.42 per thousand.

FERS - 5% Government Match for 5% Contribution CSRS - No Match

$19,500 + 6,500 = $26,000 (under age 50) (catch-up / age 50+)

TOTAL 2020

™

L2040 L2020L2030L2050 L Income

G Fund – 72.38%F Fund - 5.87%C Fund - 11.31%S Fund - 2.83%I Fund - 7.61%

G Fund – 10.22%F Fund - 8.03%C Fund - 40.12%S Fund - 13.02%I Fund - 28.61%

G Fund - 70.87%F Fund - 5.92%C Fund - 12.04%S Fund - 3.04%I Fund - 8.13%

G Fund – 32.92%F Fund - 6.96%C Fund - 30.52%S Fund - 8.56%I Fund - 21.04%

G Fund – 20.52%F Fund - 7.73%C Fund - 35.89%S Fund - 10.75%I Fund - 25.11%

Thrift Savings Plan Lifecycle Funds

Allocation as of April 2020

TSP FUNDS

FREQUENTLY ASKED QUESTIONS ABOUT YOUR ROTH TSP

G Fund - Invested in short-term US Treasury securities specially issued to the TSP. Payment of principal and Interest is guaranteed by the US Government. There is no “credit risk:’

F Fund - Offers the opportunity to earn rates of return that exceed those of money market funds over the long term with relatively low risk. The objective of the F Fund is to match the performance of the Barclays U.S. Aggregate Bond Index.

C Fund - Offers the opportunity to earn a potentially high investment return over the long term from a broadly diversified portfolio of stocks of large and medium-sized U.S. companies. The objective of the C Fund is to match the performance of the Standard and Poor’s 500 (S&P 500) Index, a broad market index made up of stocks of 500 of the largest U.S. companies. The S&P 500 makes up approximately 84% of the value of the US stock markets.

S Fund - Offers the opportunity to earn a potentially high investment return over the long term by invest-ing in the stocks of small and medium-sized U.S. companies. The objective of the S Fund is to match the performance of the Dow Jones US Completion Total Stock Market (TSM) Index, a broad market index made up of all actively traded common stocks of U.S. companies not included in the S&P 500 Index. The TSM makes up approximately 16% of the value of the US stock market

I Fund - Offers the opportunity to earn a potentially high investment return over the long term by invest-ing in the stocks of companies mostly outside the United States. The objective of the I Fund is to match the performance of the Morgan Stanley Capital International (MSCI) EAFE (Europe, Australasia, Far East) Index.

Rule of Thumb - Save at least 10% in your TSP to maximize savings. (not including matching funds)

Can I still contribute to a Roth IRA if I contribute to the Roth TSP? - If your income falls within the income limits set for Roth IRA’s, you may contribute to both the Roth TSP and the Roth IRA. What are the differences between the Roth TSP and a Roth IRA? - You can contribute significantly more to the Roth TSP (up to a maximum of $26,000 if you are age 50 or better) than to the Roth IRA (only $7,000 if you are age 50 or better). Withdrawals known as Required Minimum Distributions “RMD” are required beginning at age 72 from the Roth TSP. You are never required to take a distribution from a Roth IRA. Can I convert some of my traditional TSP to the Roth TSP? - No, conversions of your current TSP account are not allowed into the Roth TSP. When eligible, you may convert TSP dollars to a Roth IRA. Do my TSP and Roth TSP contributions have to be allocated the same way? - Yes, you will elect one allocation for all current TSP balances (both traditional TSP and Roth TSP) as well as the allocation of all future contributions. Where do the FERS matching funds go? - You were hoping that the answer was into the Roth TSP if you’re contributing there, but unfortunately, that’s not the case. All matching funds go directly to the traditional TSP.