FORT KNOX, Ky. — Have you logged into your The Thrift Savings Plan account recently? There are some new changes coming to TSP on the horizon this year.
Many of you know TSP is a financial plan for federal and members of the uniformed service used to supplement one’s future retirement income. It is estimated that TSP provides services to approximately “6.2 million participants with more than $735.2 billion managed assets.” This retirement plan is referred to as one of the “finest and largest retirement plans in the world.”
Let’s review some of the new changes.
The Internal Revenue Code specifies contribution limits each year for employer-sponsored plans. The limits for 2022 have increased to $20,500. In addition, if you are 50 years old or turning 50 in 2022, you can begin your catch-up contribution of $6,500.
The annual additional limit is being raised to $61,000.
The annual addition limit affects mostly members of the uniformed services who can exceed the annual elective deferral limit. The excess contributions go into the traditional portion of your account from tax-exempt pay earned in a combat zone. It is good to note this annual additional limit is the total amount of all the contributions you make in a calendar year. This limit is per employer and includes money from all sources: employee contributions (tax-deferred, after-tax, and tax-exempt), Agency/Service Automatic (1%) Contributions and Agency/Service Matching Contributions. It does not include catch-up contributions.
Secondly, the introduction to “My Account” (a new TSP Mobile App) is scheduled to begin transition May 26. It involves a “complete tech refresh” offering better processing, and flexibility to access your account, thus making your “TSP experience smooth, and advanced online security.”
· The participant will have access to a virtual Thriftline assistant 24/7 to help find answers and resources to common inquiries.
· You will have the ability to “live-chat” with a customer service representative during business hours.
· Navigation will be more user friendly to locate management tools.
· The mobile app will allow you to “monitor your TSP account and complete transactions anywhere, anytime from a mobile device. This would include checking your account balance, tracking fund performance, making transactions requests, submitting documents, managing payment information, and scanning checks.
· Improved security by using your own “biometrics” will be available such as fingerprint or facial recognition.
· Electronic fund transfers, to include transferring money to and from different retirement accounts, making loan payments and submitting forms by electronic signatures for many transactions. Thus quoted as to “save time and reduce paperwork by using this new online feature.”
· There will be a dedicated staff to assist with rollovers into TSP whereby simplifying the process.
· The new “mutual fund window” is being introduced. This allows TSP participants to access a variety of mutual funds for a fee and a minimum investment of $10,000. Thus, more investment options are going to be available for selection.
During this transition, some TSP documents will not be transferred to this new system. TSP is recommending you download historical statements. Should you need this data, you will be able to call the Thriftline to request information. TSP will let you know more details about “My Account” as the transition draws closer.
It is important to review your investment choices periodically to ensure they align with your retirement goals and a savings strategy that fits your needs. This holds true for any investment, not just TSP. Adjustments should be implemented after reviewing your plan. Note, there are six funds where your money can be invested, providing index funds that are made up of domestic and international stocks or the Lifecyle Funds that are designed to deliver a mixed approach to investing, targeting when funds will be needed. Now is a good time to review just that!
Lastly, TSP offers a great support system I fear few are taking advantage of. There are great tools, such as videos, resources, news updates and calculators, that are professionally designed to familiarize you with investment options. Maybe you have a hard time comprehending options that meet your savings strategy. Clear, concise information is made available for better comprehension.
Included is the Federal Ballpark Estimate financial calculator developed by the American Savings Educational Council. Designed to give you a personalized conservative benefit estimate to direct your retirement planning, this estimate gives insight in areas of your plan that need improvement. Located at the Office of Personnel Management website, it can be accessed through TSP.
For more information, the Thrift Savings Plan website has information to help you make informed decisions at tsp.gov.
If you have questions pertaining to TSP or any other financial topic, consider making an appointment with an Army Community Service professional financial counselor to help educate and assist you in making informed financial decisions. To schedule an in-person or virtual appointment, call
502-624-5989.
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Editor’s Note: For more information, go to New TSP features | Thrift Savings Plan.
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