How Do Your TSP Retirement Savings Compare to Private Sector Employees?

How much do you need to have in your TSP to retire, and how do your total TSP savings compare to private sector employees?

Your Thrift Savings Plan (TSP) is an incredibly important part of your retirement plan. 

It is often the only type of your retirement income that you can directly control. While your FERS pension and Social Security are important as well, they are pretty much fixed once you retire. 

Your TSP offers flexibility in how you invest your money as well as with when and how you spend it. 

And because we know that our TSP is so important, we all like to know how our TSP balances stacks up to the average. However, in this article, instead of comparing average TSP balances, we are going to be looking at average 401k balances to see how you compare to the private sector.

Let’s see how you stack up compared to your private sector counterparts.

Average 401k Balance by Age

AgeAverage Contribution RateAverage Balance
All Ages9%$95,600
Source: Investopedia

So how do you compare? Have you saved more or less than others your age in the private sector? Is your contribution rate higher or lower than the average? 

While looking at averages can be interesting, we have to remember that the average does not always tell the full story.

For example, let’s say there are 5 employees with the following 401k/TSP balances:

  • Employee 1: $1,000,000
  • Employee 2: $10,000
  • Employee 3: $10,000
  • Employee 4: $10,000
  • Employee 5: $10,000

The average for this group would be $208,000, but this average isn’t representative of actual balances, and in real life this sort of thing happens all the time. Oftentimes, the super high and low balances will skew averages in either direction.

How Much Should I Have Saved in My TSP?

This is a great question and one that we should all be asking.

There are numerous opinions to this question, but here is what Fidelity thinks:

AgeMultiple of Salary Saved

So if your salary stayed at 50k and you followed Fidelity’s advice to a “T”, then you would save the following throughout your life:

Age$ Saved

But if you have read my articles (or watched my YouTube videos or listened to my podcast) then you know that I believe that generic rules of thumb can be helpful but certainly should not be the end of the conversation.

For example, if you don’t have the $500k (per the above example) saved by age 67, does that mean that you can’t retire? Not at all.

It completely depends on what other income sources you have and how much you want to spend in retirement. 

I have seen millionaires not have enough to retire while others retired with just a few hundred thousand dollars. It all comes down to how you manage your money and how you spend it in retirement. 

If you want to spend $20,000/month in retirement, then you will certainly have different needs from someone who wants to spend $3,000/month. 

The 4% Rule

A great place to start when thinking about retirement savings is the 4% rule

A simplified version of the 4% rules say that if you spend 4% of your initial retirement savings balance every year then the odds of your running out of money is small. 

By following this rule, that would mean that a portfolio of $500,000 would provide you with $20,000 (4%) worth of income every year. 

The 4% rule does have more to it, but in the interest of keeping this short, I let you Google it if you want more information. 


But again, there is no perfect rule of thumb that will make sense for everyone. Regardless of how you compare to the average, you will want to run your own retirement numbers to get a feel for where you stand. 

About the Author

Dallen Haws is a Financial Advisor who is dedicated to helping federal employees live their best life and plan an incredible retirement. He hosts a podcast and YouTube channel all about federal benefits and retirement. You can learn more about him at Haws Federal Advisors.