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December 2010

MANAGING 

YOUR ACCOUNT
• 1 •

Welcome to the 

Thrift Savings Plan!

The TSP offers these important features to help

you save for retirement:

• Your contributions and earnings are taxdeferred. You pay no Federal income taxes

on the money until you withdraw it from

your account.

• FERS employees are eligible for agency

automatic and matching contributions.

• You can invest in:

– Lifecycle Funds, an automated investment tool which combines the TSP

stock, bond, and Government securities funds in professionally determined

proportions based on when you expect

to need the money; or

– Individual TSP Funds, which you can

combine in any way you choose.

• You can transfer money from other eligible

employer plans or Individual Retirement

Accounts (IRAs) to your TSP account.

• If you are age 50 or older, you may be able

to make additional catch-up contributions.

• If the need arises, you can borrow from

your account.

• You can make an in-service withdrawal

for financial hardship or after age 591⁄2.

• You have a choice of withdrawal options

after you separate. You can also leave your

money in the TSP.

To get the most out of the TSP, you need to

make several important decisions about your

account. This booklet will help you get started.
• 2 •

Getting Started

Enrolling in the TSP

All newly hired (or rehired) FERS and CSRS

employees are automatically enrolled in the TSP.

If you are automatically enrolled, your agency will

deposit 3% of your basic pay every pay period

into your TSP account unless you have made an

election to change or stop your contributions.1 If

you are a member of the uniformed services, or

are not currently contributing, you must enroll by

submitting a TSP Election Form to your agency

or service (or by making an electronic election) to

contribute to the TSP.

Changing or Starting Your 

Contributions

To take advantage of this important retirement

benefit, you should start as early as you can

and consider contributing as much as you can.

To change or start your contributions, submit a

TSP Election Form (TSP-1 for civilians; TSP-U-1

for members of the uniformed services) to

your agency or service. The form is available

from your TSP representative2 or the TSP

website. Some agencies and services require

electronic enrollment. Check with your TSP

representative.

You can stop and restart your contributions

at any time using either the TSP Election Form

or your agency’s or service’s electronic system (such as Employee Express, PostalEase,

EBIS, myPay, or the NFC PPS). Check with your

agency or service to see which one it requires.

1 You may be able to request a refund of contributions made

under the automatic enrollment program. See page 15 or visit

www.tsp.gov for more information about refunds.

2 Your TSP representative is generally a person in your personnel or

human resources office.
• 3 •

If you are not currently contributing to the TSP,

you can start making contributions from your

pay at any time.

Contribution Limits

If you are a FERS employee, you may contribute any amount up to the Internal Revenue

Code (IRC) elective deferral limit ($16,500 in

2011).

You will also receive two types of agency contributions. You do not need to complete a waiting

period to be eligible to receive either type of

agency contributions:

• Agency Automatic (1%) Contributions. 

You receive an amount equal to 1% of your

basic pay whether or not you contribute

from your pay.

• Agency Matching Contributions. Your

agency matches your contributions dollarfor-dollar on the first 3% of basic pay you

contribute per pay period, and 50 cents on

the dollar on the next 2%.

Together, these agency contributions can equal

as much as 5% of your basic pay. But you must

contribute at least 5% in order to receive the

full amount of agency money. This includes

employees who were automatically enrolled.

If you were automatically enrolled, your contribution rate is 3%, so you are not earning the

maximum matching contributions that are possible for you. Consider increasing your contributions to at least 5% of your basic pay.

Note for FERS employees: If you reach

the IRC elective deferral limit before the

end of the year, your own contributions

— and any associated Agency Matching

Contributions — will be suspended. Use

the calculator: How Much Can I Contribute? on the TSP website to avoid losing

valuable agency matching money.
• 4 •

If you are a CSRS employee, you may contribute any amount up to the IRC elective deferral

limit ($16,500 in 2011).

If you are a member of the uniformed services, you may contribute any amount up to the

IRC elective deferral limit ($16,500 in 2011). If

you elect to contribute from basic pay, you may

also elect to contribute up to 100% of incentive

pay and special pay (including bonus pay), but

your total contributions from taxable pay for

the year may not exceed this IRC limit.

Contributions made from pay that is subject to

the combat zone tax exclusion are tax-exempt.

They are not included in the elective deferral

limit, but they count toward the IRC annual

addition limit which specifies that the combined total of all contributions going into the

TSP and similar employer plans cannot exceed

100% of compensation or $49,000 in 2011,

whichever is less.

If you also contribute to a civilian TSP account,

total contributions to both your accounts cannot exceed these limits. Note for members of 

the Ready Reserve: If you contribute to the TSP

as a member of the Ready Reserve and as a

civilian FERS participant, be sure that your combined contributions do not cause you to reach

the IRC elective deferral limit before the end of

the calendar year. If you do, you could lose out

on matching contributions from your civilian

agency.

Catch-Up Contributions

If you turn age 50 or older during the calendar year and expect to reach the maximum

that you are eligible to contribute to the TSP,

you can make additional “catch-up” contributions — up to $5,500 in 2011. You must make a

separate election for these contributions each
• 5 •

year using a Catch-Up Contribution Election

form.

Your First Contributions

Your first contribution establishes your TSP

account. Your contributions will automatically be invested in the Government Securities

Investment (G) Fund until you make a different

choice. (See “Investing in the TSP” on page 8,

which describes your TSP investment options

and the actions you need to take to select them.)

Your TSP Account Number

Once your account has been established, the

TSP will mail you a “welcome letter” containing

your 13-digit account number and the identifying information your agency or service has

provided to the TSP. This account number will

be the TSP’s primary means of identifying your

account.

Web Password and ThriftLine PIN

Separately, you will receive an 8-character

Web password for accessing your account on

the TSP website (www.tsp.gov). You will also

receive a 4-digit Personal Identification Number (PIN), which you will need to access your

account on the ThriftLine (1-TSP-YOU-FRST),

the TSP’s automated voice response system.

You will need your account number and either

a Web password or ThriftLine PIN to access

your account through the website or ThriftLine,

respectively.

You can change the Web password you receive

from the TSP to one of your choice through the

My Account section of the TSP website. You

can also change your ThriftLine PIN to one of

your choice by accessing your account on the

ThriftLine. Your change will take effect

immediately.
• 6 •

User ID

Although you cannot change your TSP account

number, you can create a customized user ID to

log into your account through the TSP website.

This user ID will not be valid for any other TSP

purpose, but will help if you have difficulty

remembering your 13-digit account number.

You can establish a user ID by accessing your

account on the TSP website.

Account Protection

Safeguard your TSP account number, Web password, ThriftLine PIN, and customized user ID

to protect your account. The TSP is not responsible for losses resulting from the unauthorized

use of your account number, Web password,

ThirftLine PIN, or user ID. When using the TSP

website, please ensure that your computer is

protected against the latest viruses, Trojans,

and keylogger software. Additional information about Internet security is available in the

Security Center section of the TSP website and

on many government websites such as

www.onguardonline.gov and www.us-cert.gov.

The TSP is not responsible for losses resulting

from the use of a compromised computer.

Requesting an Account Number, Web 

Password, or ThriftLine PIN 

If you forget your account number, you can use

either the website or ThriftLine to request that

it be mailed to you again. If you lose your Web

password, you can request a new one through

the My Account section of the TSP website. If

you lose your PIN, you can request a new one

on the ThriftLine. You can also contact the TSP.

If you make a written request, you must include

your TSP account number and date of birth in

your letter. You should receive your new Web

password, new PIN, or remailed account number
• 7 •

within 10 days of the TSP receiving your request.

In the meantime, you may not be able to access

your account through the TSP website or

ThriftLine.

Your Beneficiary Designation

You can designate one or more persons, a trust,

or another entity to receive your TSP account

in the event of your death. To designate beneficiaries, complete a Designation of Beneficiary

form (Form TSP-3). The form is available at

www.tsp.gov or from your agency or service TSP

representative.

If you make a valid beneficiary designation for

your TSP account, you will receive a confirmation of your designation in the mail. Your

primary beneficiaries will also be shown on

your annual TSP participant statement, which is

mailed to you at the beginning of each calendar

year. Alternatively, if your designation is invalid

and cannot be processed, you will be notified

by the TSP.

If you do not designate beneficiaries, in the

event of your death, your account will be distributed according to the order of precedence

required by law: to your widow or widower; if

none, to your child or children equally, and

descendants of deceased children by representation; if none, to your parents equally or to

the surviving parent; if none, to the appointed

executor or administrator of your estate; or, if

none, to your next of kin who is entitled to your

estate under the laws of the state where you

resided at the time of your death.

Be sure to keep your beneficiary designation up

to date to reflect changes in your life, such as

marriage, births, adoptions, divorce — even a

change of address for your beneficiaries. Send

a new form to change a beneficiary designation

or update information.
• 8 •

A will is not a substitute for a Designation

of Beneficiary form and will not be accepted for

the distribution of your TSP account.

Beneficiary Participant Accounts

All death benefits of $200 or more that are

processed for a spouse beneficiary are automatically deposited into a new TSP account

established in the spouse’s name. Beneficiary

participants will be able to manage their investments and are eligible for the same withdrawal

options as separated participants. Upon the

death of a beneficiary participant, the account

must be distributed to the beneficiary(ies) of

the beneficiary participant; it cannot remain in

the TSP. (For more information, see the booklet

Your TSP Account: A Guide for Beneficiary 

Participants.)

Investing in the TSP

The TSP offers you two approaches to investing

your account:

• Lifecycle Funds (L Funds)

• Individual TSP Funds (G, F, C, S, and

I Funds)

Lifecycle (L) Funds

The L Funds offer an easy option for those participants who do not have the time, interest, or

knowledge to manage their TSP investments.

The L Funds are “lifecycle” funds that are

invested according to a professionally determined mix of stocks, bonds, and securities based on various time horizons. (A time

horizon is the date when you expect to withdraw your money.) L Funds with farther time
• 9 •

horizons (for example, L 2050 and L 2040) are

focused on growth, and therefore are invested

more aggressively, with higher percentages in

foreign and domestic stocks and lower percentages in Government securities. As each L Fund

matures, its mix gradually shifts to more conservative investments with a higher percentage

of Government securities and lower percentages of stocks. This more conservative mix is

designed to preserve assets while still providing protection against inflation. (Detailed

information about each L Fund is available on

the TSP website.)

Each L Fund is automatically rebalanced,

generally each business day, to restore the fund

to its intended investment mix. Each quarter, the fund’s asset allocation is adjusted to

slightly more conservative investments. When

an L Fund reaches its time horizon, it will roll

into the L Income Fund, and a new fund will be

added with a more distant time horizon.

The TSP offers five L Funds based on time

horizon:

• L 20501— 2045 and later

• L 2040— 2035 through 2044

• L 2030— 2025 through 2034

• L 2020— 2015 through 2024

• L Income— Now withdrawing or expecting

to begin withdrawing by 2014

If you decide to invest your entire account 

in one of the L Funds, you are done making

your investment decisions. Your L Fund will

automatically rebalance based on your time

horizon.

1 The L 2050 Fund will be available at the end of January 2011. It

was established following the retirement of the L 2010 Fund in

December 2010.
• 10 •

Individual TSP Funds 

The TSP has five individual investment funds: 

Government Securities Investment 

(G) Fund— invested in short-term, U.S.

Treasury securities that are specially issued

to the TSP (Government securities with no

risk of loss)

Fixed Income Index Investment 

(F) Fund— invested in a bond index fund

that tracks the Barclays Capital U.S. Aggregate Bond Index (U.S. investment-grade

corporate, Government, and mortgagebacked securities)

Common Stock Index Investment 

(C) Fund— invested in a stock index fund

that tracks the Standard & Poor’s 500

(S&P 500) Stock Index (primarily large

U.S. companies)

Small Capitalization Stock Index Investment (S) Fund— invested in a stock index

fund that tracks the Dow Jones U.S. Completion Total Stock Market Index (medium

to small U.S. companies)

International Stock Index Investment 

(I) Fund— invested in a stock index fund

that tracks the Morgan Stanley Capital International EAFE (Europe, Australasia, Far

East) Stock Index (primarily large companies in 22 developed countries)

Visit www.tsp.gov for detailed fund descriptions

and information on fund performance.

If you choose your own investment mix from

the G, F, C, S, and I Funds, remember that your

investment allocation is one of the most important factors affecting the growth of your TSP

account. If you prefer this “hands-on” approach,

keep the following points in mind:

• Consider both risk and return. Over a long

period of time, the F Fund (bonds) and
• 11 •

the C, S, and I Funds (stocks) have higher

potential returns than the G Fund (Government securities). But stocks and bonds also

carry the risk of investment losses, which

the G Fund does not. On the other hand,

investing entirely in the G Fund may not

give you the returns you need to meet your

retirement savings goal.

• You need to be comfortable with the amount 

of risk you expect to take. Your investment

comfort zone should allow you to use a

“buy and hold” strategy so that you are not

chasing market returns during upswings, or

abandoning your investment strategy during downswings.

• You can reduce your overall risk by diversifying your account. The five individual TSP

funds offer a broad range of investment

options, including Government securities,

bonds, and domestic and foreign stocks.

Generally, it’s best not to put “all of your

eggs in one basket.”

• The amount of risk you can sustain depends 

upon your investment time horizon. The

more time you have before you need to

withdraw your account, the more risk you

can take. (This is because early losses can

be offset by later gains.)

• Periodically review your investment choices. 

Check the distribution of your account balance among the funds to make sure that

the mix you chose is still appropriate for

your situation. If not, rebalance your account to get the allocation you want.

Deciding on Your Approach

The TSP investment options are designed for

you to choose either the L Fund that is appropriate for your time horizon or a combination of

the individual TSP funds that will support your

personal investment strategy. However, you are
• 12 •

permitted to invest in any fund or combination

of funds. Just keep in mind that the L Funds are

made up of the five individual TSP funds (G, F,

C, S, and I). If you invest in an L Fund as well as

in the individual funds, you will duplicate some

of your investments, and your allocation may

not be what you wanted.

Implementing Your Investment Choice

Once you have decided on your investment

approach — professionally designed (L Funds)

or self-directed (individual TSP funds) — there

are two transactions you can make to put your

money in the fund(s) you have chosen:

• The first transaction you need to make is

a contribution allocation. This transaction

directs how new money (contributions,

transfers into the TSP, loan payments) will

be invested. It does not change your existing account balance.

• The second transaction you may want to

make is an interfund transfer (IFT). An IFT

is a transaction that allows you to redistribute all or part of your existing TSP account

among the different TSP funds. For each

calendar month, your first two IFTs can redistribute money in your account among any

or all of the TSP funds. After that, for the

remainder of the month, your IFTs can only

move money into the Government Securities

Investment (G) Fund (in which case, you will

increase the percentage of your account held

in the G Fund by reducing the percentage

held in one or more of the other TSP funds).

An IFT has no effect on new money coming

into your account. (If you have both a civilian

and a uniformed services account, this

applies to each account separately.)

The transfer counts in the calendar month we

process it, not in the month you submit it.
• 13 •

You can perform these transactions in the My

Account section of the TSP website, using your

TSP account number (or customized user ID)

and Web password, or you can request these

transactions through the ThriftLine, using your

TSP account number and PIN (see page 5).

Transferring Other Investments Into 

Your TSP Account 

If your TSP account has already been established, you can transfer (pre-tax) balances from

your traditional IRAs or eligible employer plans

into your account. This money will be invested

according to your most recent contribution

allocation. Use the form Request for a Transfer

Into the TSP (Form TSP-60 for civilians;

Form TSP-U-60 for members of the uniformed

services), which is available at www.tsp.gov.

Account 

Information

Your Account Balance

Your account balance (expressed in both dollars and shares) is available in the My Account

section of the TSP website and on the

ThriftLine. Your account balance is updated

at the end of each business day based on that

day’s closing share prices and any transactions

processed that night.

Your Participant Statements

Your first quarterly statement will be mailed

to you. After that, quarterly statements will be

available only on the TSP website unless you
• 14 •

make a request to continue receiving them in

the mail. You can make this request on the TSP

website or the ThriftLine.

You will also receive an annual participant

statement at the beginning of each calendar

year. That statement will provide a summary of

your account activity for the previous year and

give you other information, such as a listing of

your primary beneficiaries, an account profile,

and your cumulative lifetime contributions to

the TSP. You should review and verify all the

information on this statement.

Check all your statements to ensure that:

• your personal information (name, address,

date of birth, etc.) is correct;

• your beneficiary designation information is

correct;

• the contribution amount is correct;

• payments on any loans you may have are

being deposited correctly; and

• transactions (interfund transfers, loans,

withdrawals, etc.) have been properly recorded.

Correcting Your Account Information

To correct personal information, active employees and members of the uniformed 

services should have their agencies or services

make any corrections to their TSP account

records. Separated participants should notify

the TSP directly. A separated participant can also

make address changes on the TSP website or

send Form TSP-9, Change in Address for Separated Participant, to the TSP.

To update your beneficiary information or

change your beneficiary(ies), send a new Designation of Beneficiary form (Form TSP-3) directly

to the TSP.
• 15 •

If you change agencies (or payroll offices), 

make sure that your TSP contributions (and

your loan payments, if any) continue after you

transfer. Report any errors to your new payroll

office immediately, and follow up to make sure

the corrections took effect.

Getting Your 

Money Out

Automatic Enrollment Refunds

Generally, if you were automatically enrolled

in the TSP, you have 90 days from the date of

your first contribution to request a refund of

your own automatic enrollment contributions

and earnings using Form TSP-25, Automatic

Enrollment Refund Request. If you are a FERS

employee, you will forfeit your Agency Matching Contributions, but Agency Automatic (1%)

Contributions will remain in your account.

Loans

The TSP loan program allows eligible participants to borrow from their accounts and repay

the loan with interest.

There are two types of loans:

• General purpose loans, which can be used

for any purpose, have a repayment period

of 1 to 5 years.

• Residential loans, which are available only

for the purchase or construction of a primary residence, have a repayment period

of 1 to 15 years.
• 16 •

To learn more about the loan program, read the

TSP booklet Loans, which is available from the

TSP website or from your agency or service. In

particular, read the section that discusses the

things to consider before you borrow; it will

help you decide whether your TSP account is

your best option for borrowing money. Taking

a loan can reduce your TSP balance at retirement because the interest rate you pay to your

account for the loan may be less than the earnings you would have received if the money had

remained in your account.

In-Service Withdrawals

If you are still employed by the Federal Government, you can withdraw money from your account only under the following circumstances:

• If you are 591⁄2 or older, you may make a

one-time age-based in-service withdrawal.

• If you have a financial hardship, you may

make a financial hardship in-service withdrawal (limited to one every 6 months). You

will not be allowed to make contributions

to your account for 6 months after you

make the withdrawal. (If you are a FERS

employee, you will not receive Agency

Matching Contributions during that time;

Agency Automatic (1%) Contributions will

continue.) In addition, if you are under age

591⁄2, you may be required to pay an early

withdrawal penalty tax.

Other restrictions apply to these withdrawals.

Read the TSP booklet In-Service Withdrawals and

the TSP tax notice “Important Tax Information

About Payments From Your TSP Account” for

more information.

Post-Separation Withdrawals

When you leave Federal service, you have a

number of withdrawal options:
• 17 •

• Leave your money in the TSP. If you have

$200 or more, you can leave your account

in the TSP. (If your vested account balance

is less than $200, the TSP will automatically

send you the entire amount in a single payment. You cannot leave it in the TSP.)

You must withdraw your account (or begin

receiving monthly payments) by April 1 of

the year following the year you turn 701⁄2

and are no longer in Federal service.

If you have both a civilian and a uniformed

services TSP account and you separate

from Federal civilian service or from the

uniformed services (or both), you may combine your TSP accounts. Use Form TSP-65,

Request to Combine Uniformed Services

and Civilian TSP Accounts.

• Make a partial withdrawal. You may make

a one-time, single-payment, partial withdrawal (but only if you had not previously

made an age-based in-service withdrawal).

• Make a full withdrawal. You have three options to withdraw your entire TSP account

balance:

– A single payment

– Monthly payments

– An annuity (purchased for you

by the TSP at a minimum of $3,500)

You can combine any of these three full withdrawal options.

You can also have the TSP transfer part or all

of certain types of withdrawals to a traditional

IRA, an eligible employer plan, or a Roth IRA.

When considering your withdrawal options, use

the calculators on the TSP website to estimate

the amount of annuity payments or monthly

payments you might receive.
• 18 •

The booklet Withdrawing Your TSP Account After 

Leaving Federal Service describes your TSP withdrawal options. You should also read the TSP

tax notice “Important Tax Information About

Payments From Your TSP Account.” The booklet

and tax notice are available from the TSP

website, your agency or service, or the TSP.

Spouses’ Rights

Spouses’ rights requirements apply to loans,

in-service withdrawals, and post-separation

withdrawals.

Loans, In-Service Withdrawals, and Partial 

Withdrawals. If you are a married FERS participant or a member of the uniformed services,

your spouse must give written consent to your

loan, or notarized written consent to your inservice or partial withdrawal request. If you are

a married CSRS participant, the TSP will notify

your spouse of your loan application or your

partial or in-service withdrawal request.

Post-Separation Full Withdrawals. Spouses’

rights requirements apply to vested accounts

of more than $3,500. If you are a married FERS

participant or a member of the uniformed

services, your spouse is entitled to a prescribed

joint life and survivor annuity. If you select any

other withdrawal option (including any other

annuity option), your spouse must first waive

his or her right to the prescribed annuity. If you

are a married CSRS participant, the TSP must

notify your spouse of any withdrawal election.

Under certain limited circumstances, exceptions to these requirements may be granted.

See Form TSP-16, Exception to Spousal

Requirements (TSP-U-16 for members of the

uniformed services), available on the TSP

website.
• 19 •

Check List for New 

Participants

3 If you are a new FERS participant, consider

increasing your employee contributions to

at least 5% of your basic pay to make sure

that you earn the maximum agency matching funds.

3 Safeguard your TSP account number, your

Web password, your ThriftLine Personal

Identification Number (PIN), and, if applicable, your Web user ID to protect your

account.

3 Read about your TSP investment options.

3 Decide whether you want to use one of

the TSP’s professionally designed Lifecycle

Funds or manage your own TSP investments.

3 Make a contribution allocation to direct

the way your future contributions are

invested.

3 Make an interfund transfer to move your

existing account balance into the funds

of your choice. (New accounts are invested

in the G Fund.)

3 Decide whether you want to designate

beneficiaries for your account.

To learn more about the TSP, ask your agency

or service for a copy of the Summary of the Thrift 

Savings Plan, or download one from the TSP

website at www.tsp.gov. The forms and publications referred to in this booklet can be

obtained from the TSP website or your TSP

representative.
• 21 •

TSP Website

www.tsp.gov

ThriftLine

1-TSP-YOU-FRST

(1-877-968-3778)

(Toll free from the United States

 and Canada)

All Other International Callers 

404-233-4400

(Not toll free)

Fax Number

1-866-817-5023

TDD

1-TSP-THRIFT5

(1-877-847-4385)

TSP Mailing Address

Thrift Savings Plan

P.O. Box 385021

Birmingham, AL 35238
Federal Retirement Thrift Investment Board

TSPBK30 (12/10) 

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