What is the TSP?

What is the Thrift Savings Plan?

In simple terms, the TSP is the Federal Governments' version of a 401k plan.

It is a defined contribution plan where Federal employees and Military service members can contribute a percentage of their pay, on a tax deferred basis, and the government will match those contributions up to 5%.

Investment options are very straightforward and include 3 stock funds, 1 bond fund, and a money market fund.

Life Cycle funds are a combination of the 5 core TSP funds. They rebalance quarterly, decreasing your exposure to the stock funds as you progress toward retirement.

The Mutual Fund Window (MFW) gives TSP investors access to a world of investment options outside of the core TSP. There are restrictions on the amount you can invest, and a variety of fees apply. The MFW can be a great supplement to your core TSP account.

The TSP is a vehicle designed to build wealth for retirement. It is not a “day trading” platform.

Next, we are going to take a look at the 3 factors that MOST affect your TSP account growth.

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