TSP Open Season Begins Friday

TSP Open Season begins Friday, April 15.

The Thrift Savings Plan open season begins Friday, April 15 – meaning federal employees will be able to enroll in the plan or change their current contributions. The open season would have normally concluded June 30; however, beginning July 1, the open seasons will be eliminated and federal workers will be able to enroll or change their contribution amounts at any time.

The five TSP funds are: the Government Securities Investment ( G ) Fund; the Common Stock Index Investment ( C ) Fund; the Fixed Income Index Investment ( F ) Fund; the Small Capitalization Stock Index Investment ( S ) Fund; and the International Stock Index Investment ( I ) Fund.

TSP officials said they also hope to make “Lifecycle” funds available mid-2005. Lifecycle funds are target asset allocation portfolios that will hold a mix of the five funds currently available. The mix of funds is chosen based on the date the employee expects to need money for retirement.

To enroll or change contribution amount, feds should give their agency or service a completed TSP Election Form – TSP-1 (or TSP-U-1 for members of the uniformed services) – unless the agency or service requires workers to use an automated system, such as Employee Express, PostalEASE, or myPay. Employees should check with their agency or service for guidance.

This open season applies only to regular TSP contributions. It does not include TSP catch-up contributions which are not tied to open seasons.

TSP offers investors the chance for lower taxes each year they contribute while not having to pay taxes on earnings until they reach retirement. Contribution elections and/or changes made between April 15 and June 11 will take effect June 12 for service-members and civilians. Changes made on or after June 12 will become effective at the beginning of the pay period following the one in which the election is made for civilians and the following month for military.

As a result of the open seasons being eliminated beginning July 1, civilian employees and service-members may start, change, stop or resume contributions at any time. For civilians, the elections will be effective at the beginning of the pay period following the one in which submitted, and for military members elections will be effective the following month.

Some of the specifics of the program include:


— Servicemembers can contribute as much as 10 percent of their base pay, as long as the annual total of tax-deferred investment is not more than $14,000 for 2005.

— Those serving in tax-free combat zones are allowed up to $42,000 in annual contributions.

— Contribution allocations (how an employee chooses to invest money among the five funds) can be made by calling the TSP automated ThriftLine at (877) 968-3778 for people in the 50 States, Virgin Islands, Puerto Rico, Guam, American Samoa and Canada, or (504) 255-8777 for people elsewhere, or on the TSP web site.


Contribution limits are based on which retirement system an employee has. For the current open season, the following contribution rates apply:

— FERS employees may contribute as much as 15 percent of basic pay each pay period. Once eligible, the government provides matching funds of up to 4 percent as well as an automatic 1 percent each pay period, whether the employee contributes or not, making the government’s contribution 5 percent.

— Employees covered by the Civil Service Retirement System may contribute as much as 10 percent of basic pay, but do not receive any agency contributions.

— Beginning in December, there will no longer be percentage limits on how much FERS and CSRS employees may contribute each year. Contributions will be restricted only by the Internal Revenue Code’s annual limit, which is $15,000 for 2006.

— Specific information is available for civilian employees on the TSP web site.

— Contribution allocations (how an employee chooses to invest his or her money among the five funds) are made via the “Account Access” section of the TSP web site, or by calling the ThriftLine at (877) 968-3778 for employees in the 50 States, Virgin Islands, Puerto Rico, Guam, American Samoa and Canada; (504) 255-8777 for employees elsewhere.

More information about the Thrift Savings Plan can be found in the booklet “Summary of the Thrift Savings Plan” on the TSP home page under civilian or uniformed services TSP Forms and Publications.

About the Author

Ralph Smith has several decades of experience working with federal human resources issues. He has written extensively on a full range of human resources topics in books and newsletters and is a co-founder of two companies and several newsletters on federal human resources. Follow Ralph on Twitter: @RalphSmith47