Phased Retirement and the TSP

The Thrift Savings Plan has issued some guidelines for federal employees who fall under the new phased retirement status to be aware of as they transition into the new phased retirement program.

In light of the announcement from OPM about the finalized rules for phased retirement, the Thrift Savings Plan has issued this announcement for federal employees:

TSP participants should be aware of the following:

  • Employees in phased retirement status (“phased retirees”) continue their eligibility to participate in the TSP. They are eligible to contribute to the TSP and are subject to the normal restrictions regarding TSP loans, financial hardship withdrawals, and age-based in-service withdrawals.
  • Phased retirees are not eligible for post-employment withdrawals.
  • Phased retirees will not be subject to required minimum distributions or the TSP withdrawal deadline.
  • All sources of contributions (employee contributions, Agency Automatic Contributions, and Agency Matching Contributions) to phased retirees’ TSP accounts will be calculated on basic pay received each pay period and will not consider the annuity payment from OPM.

About the Author

Ian Smith is one of the co-founders of He has over 20 years of combined experience in media and government services, having worked at two government contracting firms and an online news and web development company prior to his current role at FedSmith.