2008 

TSP Participant 

Survey Results 
2 

Table of Contents 

Executive Summary ...................................................................................................................... 3

About The Survey.......................................................................................................................... 5

Part A: TSP Benefits And Services............................................................................................. 8

Overall Satisfaction With TSP And Customer Service................................................................ 8

Information And Resources....................................................................................................... 11

Current TSP Design .................................................................................................................. 16

Making Administrative Changes................................................................................................ 18

Asset Allocation In The TSP ..................................................................................................... 19

Withdrawals And Rollovers ....................................................................................................... 27

Part B: Savings And Contributions To The TSP ..................................................................... 33

Level Of TSP Participation ........................................................................................................ 33

Savings Rates In The TSP........................................................................................................ 39

Sources Of Retirement Income................................................................................................. 42

Retirement Goals And Expectations ......................................................................................... 46

Part C: Potential Changes To The TSP ..................................................................................... 51

Adding A Roth 401(K) Option.................................................................................................... 51

Self-Directed Mutual Funds....................................................................................................... 56

Improving Participation In The TSP .......................................................................................... 59

Part D. Impact Of Financial And Economic Situation On TSP Contributions And 

Investments.................................................................................................................................. 61

In Summary ................................................................................................................................ 664

Appendix A: Demographics ......................................................................................................... 66

Appendix B: Survey Instrument................................................................................................... 69
3 

Executive Summary 

The Federal Retirement Thrift Investment Board (FRTIB) contracted with Watson Wyatt 

Worldwide, an independent consultancy, in a follow-up study of the opinions of Federal 

employees and uniformed services members with regard to their needs, attitudes, 

understanding, and satisfaction with the Thrift Savings Plan (TSP) plan. The survey was 

also designed to gauge participants’ reactions to some potential enhancements to the TSP 

that are under consideration. A survey was conducted in November 2008 through a 

paper-based mailing to the homes of a random sample of Federal employees and 

uniformed service members who have participated in the TSP. 

The key findings of the survey include: 

• Overall, Federal employees and uniformed service members are satisfied with the 

ease of use, security and the quality of services provided by the TSP. 

• TSP is identified as critical to the retirement security of Federal employees and 

uniformed service members 

• Members of the Federal Employees’ Retirement System (FERS) are highly 

engaged with the TSP, contributing a percentage of pay at much higher rates than 

those in the private sector. 

• There is some evidence that the financial turmoil occurring at the time of the 

survey is having an effect on employees. For example, there was an increase in 

respondents saying they didn't have enough money to contribute to the plan, and 

there is evidence that some respondents have had to cut or eliminate their 

contributions or take money out of their account. 

• As of the survey date, most participants had not made major changes to their 

retirement savings patterns in response to the financial and economic situation. 

The most commonly cited actions that participants have or are considering 

undertaking was to put more of their account balance into the G Fund and to 
4 

change how they invest their new contributions. As such, there appears to be an 

increase in more conservative investment strategies among respondents. 

• While 56 percent of respondents prefer adding a Roth feature to the TSP, only 36 

percent have established a Roth IRA account. Many respondents who expect 

their tax rates to decline in retirement nevertheless say they would contribute to a 

Roth 401(k) account if that option were available, despite the tax disadvantages of 

doing so. 

• Two out of 5 respondents support adding a self-directed mutual fund window. 

This option would address the segment of TSP participants (between 18 and 30 

percent) who indicated in 2006 that the TSP should add additional investment 

options even if they cost more. Ten percent of respondents in the current survey 

indicated they would be willing to pay an annual fee of $100 to use the selfdirected mutual fund window. 

• Most respondents believe that it would be possible to get more Federal employees 

and uniformed service members to contribute to the TSP. The most often cited 

changes to increase participation are automatic enrollment for new 

employees/members of the uniformed services and matching contributions for 

members of the uniformed services. 
5 

About the Survey 

The Federal Retirement Thrift Investment Board (FRTIB) partnered with Watson Wyatt 

in November 2008 to conduct a survey of participants in the Thrift Savings Plan (TSP). 

This survey is an extension of an earlier survey that was fielded in September 2006. As 

with the previous study, the objectives of this survey included gaining a better 

understanding of participants’ needs, attitudes, understanding, and satisfaction with a 

number of elements of the TSP. The study also sought to gauge participants’ reactions to 

some potential changes to the TSP that are under consideration. 

To create a valid survey instrument, Watson Wyatt and the FRTIB collaborated to refine 

survey content through an iterative process. As part of this exercise, the team 

administered two pretest sessions with FRTIB employees, Federal employees, and 

Federal human resource representatives outside of the FRTIB to solicit feedback on the 

ease and appropriateness of the instrument. The final instrument contained 48 closedended items (including sub-items) as well as one open-ended question in which 

participants were asked to provide comments or suggestions regarding the TSP. The 

survey also included several demographic questions to allow segmentation of results. 

The final survey content was approved by senior leadership, including the Executive 

Director of the FRTIB, prior to survey administration. The final survey instrument is 

included as Appendix B to this report. Watson Wyatt performed all survey distribution, 

data collection, and data analysis to ensure confidentiality. 

Watson Wyatt mailed paper survey packets to 35,121 randomly selected Federal 

employees and uniformed service members to achieve a statistically reliable, 

representative sample. In addition to the paper survey, respondents were also given an 

option to complete the survey online. There were 871 survey packets returned as 

undeliverable, leaving 34,250 eligible for completion. Survey administration occurred 

between November 17 and November 26, 2008. A total of 4,891 FRTIB participants 

completed the online or paper survey, representing a total response rate of 14.3 percent. 

Overall, 68% of respondents (3,305) completed the survey on paper, while the other 32% 
6 

(1,586) completed it online. The response rate for the 2006 survey was 19 percent. The 

higher response for the previous survey is the result of two separate solicitations in 

November 2006 and March 2007. 

The table below provides the standard errors at the total program level as well as at the 

retirement system level for a 95 percent confidence interval (see Figure 1.1). In 

analyzing any particular survey item, the actual margin of error will vary based on the 

number of respondents who answered that item and the actual estimated distribution of 

the responses. 

Fig. 1.1 Number Responding and Estimated Margins of Error by Retirement System 

Retirement System Number Mailed Number Responding Margin of Error

TSP Overall 35,1211 4,891 1.4% 

Civil Service Retirement System (CSRS) 1,389 2.6% 

Federal Employees’ Retirement System (FERS) 1,292 2.7% 

Uniformed Services (Active Duty and Reserves) 2,210 2.1% 

1 Overall, 871 surveys were unable to be delivered, resulting in an adjusted response rate of 14.3%. 

Fig. 1.2 Distribution of Respondents by Retirement System 

Uniformed 

Services, 45.2%

Federal 

Employees’ 

Retirement 

System (FERS), 

26.4%

Civil Service 

Retirement 

System (CSRS), 

28.4%
7 

Again, it is important to recognize that the survey was fielded at a time when there was a 

tremendous amount of uncertainty in the economy and in the financial markets. The 

financial crisis has eroded the savings and wealth of millions of American families and 

job losses are on the rise. Over the three months from September through November 

2008, the S&P 500 index declined more than 35 percent during a period of significant 

market volatility. Likewise, housing values declined significantly in many regions of the 

country, creating additional angst among employees, especially those nearing retirement. 

It is quite reasonable to expect that the reactions of Federal employees and uniformed 

services members to questions about retirement expectations, goals and, specifically, the 

Thrift Savings Plan will be influenced by the turbulent market environment. It is quite 

difficult to determine the magnitude of this impact in the responses. However, 

comparisons to the previous survey results are added throughout the report to help 

provide insight into how perceptions have changed between the two periods. 
8 

Part A: TSP Benefits and Services 

Overall Satisfaction with TSP and Customer Service 

As a whole, respondents have a high level of satisfaction with the TSP, reporting an 

81 percent favorable rating for “overall satisfaction with the TSP” and 75 percent 

favorable rating for the “overall quality of services provided by the TSP” (see 

Figure 2.1 to 2.4). While these findings dipped slightly since the 2006-07 Participant 

Survey (by -4 and -5 percent respectively), these results compare favorably to the 68 

percent of private-sector participants who indicate a favorable rating on their 401(k) 

plan.1 Further, this drop may also be partially attributed to displeasure with investment 

performance during the current economic climate. Notably, the lowest levels of overall 

satisfaction with the TSP are among younger and lower-paid participants, who are most 

vulnerable in the current economic climate. Specific indicators of high participant 

satisfaction with the TSP include the quality of available plan services and the level of 

customer service. Eighty-one percent of respondents report satisfaction with the service 

options available to them. 

Fig. 2.1 Satisfaction with the TSP

 

 

1

 Watson Wyatt Retirement Attitude Survey (2004) collected responses on overall 401(k) plan satisfaction 

from 7,911 private sector employees at 982 firms. 

81%

85%

75%

81%

63%

65%

54%

52%

82%

53%

63%

15%

12%

16%

30%

27%

40%

40%

16%

42%

34%

6%

7%

20%

3

5

3

8%

7%

4

6%

2

3

2008

2006

2008

2006

2008

2006

2008

2006

2008

2006

2008

2006

Favorable Neutral Unfavorable

Overall satisfaction with the TSP 

Overall quality of services provided by 

the TSP 

Accuracy and timeliness of the 

processing of forms submitted to the 

TSP 

Quality of services provided by the TSP 

telephone service representatives 

Accessing my TSP account online is 

safe and secure 

In the past two years, the TSP has 

become a better program 

Notes: Based on all respondents, N=4,891.

N/A 
9 

For those who submitted forms to the TSP for processing, 63 percent are satisfied with 

the accuracy and timeliness of this service, a slight drop from the 2006-07 survey. The 

majority of respondents do not have an opinion about the quality of service received from 

TSP telephone service representatives on the ThriftLine. We know this because most left 

the related question blank or selected “Not Applicable”, indicating they likely did not 

speak with a service representative. Of those who did respond to the question, more than 

half (54 percent) report they are satisfied, while another 40 percent were “neutral” – a 

similar result to the 2006-07 survey. This is not surprising given participants’ strong 

preference for the web over phone interaction. For those who access their account online, 

most participants (82 percent) believe it is safe and secure. 

An area in which respondent opinion has become less favorable since the 2006-07 survey 

is the perception of the TSP becoming a better program in the last two years, with 53 

percent in agreement, down 10 percentage points. Again, this result may be attributed 

more to the decline in participants’ asset values due to the market conditions at the time 

of the survey than to actual changes in the program made in the last two years. An 

additional factor could be attributed to the restrictions on interfund transfers implemented 

in 2008. 

Fig. 2.2 Satisfaction with the TSP by Retirement System 

CSRS FERS Uniformed Service 

Favorable Unfavorable Favorable Unfavorable Favorable Unfavorable 

Overall satisfaction with the TSP - 2008 86.1% 2.9% 82.6% 3.2% 77.0% 5.7% 

Overall satisfaction with the TSP - 2006 87.7% 2.7% 85.4% 2.4% 83.2% 3.8% 

Overall quality of services provided by the 

TSP - 2008 

79.7% 3.4% 77.3% 3.6% 71.8% 6.5% 

Accuracy and timeliness of the processing 

of forms submitted to the TSP- 2008 70.1% 6.2% 64.9% 5.7% 56.4% 9.7% 

Quality of services provided by the 

ThriftLine - 2008 62.2% 5.4% 57.1% 4.5% 46.6% 7.9% 

Accessing my TSP account online is safe 

and secure- 2008 79.6% 2.4% 79.5% 3.4% 83.8% 1.8% 

In the past two years, the TSP has 

become a better program- 2008 57.3% 5.0% 50.9% 5.8% 50.6% 5.8% 

Notes: Based on all respondents, N=4,891. 
10 

“TSP is a phenomenal program. I am active duty and I think the Uniformed Services should do 

two things: 1.) Provide matching contributions and 2.) do automatic enrollment.” 

Fig. 2.3 Satisfaction with the TSP by Pay 

Less than $40K $40K to $80K $80K and Over 

Favorable Unfavorable Favorable Unfavorable Favorable Unfavorable 

Overall satisfaction with the TSP - 2008 75.5% 5.7% 82.3% 3.8% 82.3% 4.4% 

Overall satisfaction with the TSP – 2006 78.9% 5.0% 86.1% 2.7% 88.0% 2.1% 

Overall quality of services provided by the 

TSP – 2008 70.3% 5.9% 76.4% 4.7% 77.0% 4.7% 

Accuracy and timeliness of the processing 

of forms submitted to the TSP - 2008 56.7% 9.2% 64.9% 6.8% 62.5% 7.7% 

Quality of services provided by the 

ThriftLine - 2008 53.2% 8.5% 56.0% 5.0% 50.7% 6.5% 

Accessing my TSP account online is safe 

and secure - 2008 75.4% 4.2% 81.3% 2.4% 85.2% 1.5% 

In the past two years, the TSP has become 

a better program - 2008 49.8% 5.7% 52.5% 5.4% 54.4% 5.8% 

Notes: Based on all respondents, N=4,891. 

Fig. 2.4 Satisfaction with the TSP by Age 

Less than Age 40 40s Over Age 40 

Favorable Unfavorable Favorable Unfavorable Favorable Unfavorable 

Overall satisfaction with the TSP - 2008 76.7% 5.9% 81.3% 4.3% 82.8% 3.6% 

Overall satisfaction with the TSP - 2006 84.4% 3.6% 84.5% 3.0% 85.9% 2.8% 

Overall quality of services provided by the 

TSP – 2008 71.6% 7.4% 77.0% 4.3% 76.5% 4.0% 

Accuracy and timeliness of the processing of 

forms submitted to the TSP– 2008 59.3% 9.5% 61.8% 6.9% 64.5% 7.1% 

Quality of services provided by the 

ThriftLine– 2008 48.9% 6.5% 51.2% 6.6% 57.1% 5.9% 

Accessing my TSP account online is safe 

and secure– 2008 83.6% 2.4% 83.6% 1.9% 79.8% 2.6% 

In the past two years, the TSP has become a 

better program– 2008 50.9% 6.2% 50.5% 5.3% 54.4% 5.5% 

Notes: Based on all respondents, N=4,891. 
11 

Information and Resources 

American employees assume a significant role in preparing for and ensuring a secure 

retirement. Employers, however, must provide the essential information, education and 

resources to help their employees meet this goal. The ability of employees to access 

account information easily and as often as needed is an important step for employers in 

ensuring retirement preparedness. 

TSP participants overwhelmingly note that the Internet (See Figures 3.1 & 3.2) is 

their preferred means for accessing and receiving TSP account information. 

Participants generally favor accessing their account information online from home (49 

percent). Uniformed service members are particularly Internet savvy, as nearly 3 in 5 

report accessing their TSP account information online from home. In addition, younger 

Federal employees also have a proclivity for retrieving their account information through 

their home Internet connection. Dedicating greater resources to enhancing the TSP’s 

web-based information and tools would have wide-ranging effects for TSP 

participants. 

“...I wish the web site was more user friendly & set up more like a traditional investment / 

401k program in which I was able to have more options for reviewing & researching 

investments options... to look at my investments over time.” 

Despite today’s high-tech information age, a large number of participants (24 percent) 

continue to favor paper statements for their account information. The number of quarterly 

paper statements that are printed and mailed by the TSP is actually about 14 percent of 

the population. The difference may be attributable to the TSP’s online capability, where 

participants can print their statement via the Web. Only 4 percent of respondents rely on 

the TSP ThriftLine for regular updates on their account. In fact, less than half of all TSP 

participants (45.7 percent) indicate having ever contacted the TSP ThriftLine and spoken 

to a telephone service representative about their account. 
12 

Fig. 3.1 How TSP Participants Usually Access Account Information by Retirement System 

How do you usually access/receive your TSP account information?

CSRS FERS 

Uniformed 

Services All - 2006 All - 2008 

Online from home 46.5% 48.2% 60.4% 49.4% 53.2% 

Online from work 33.0% 37.5% 30.1% 38.0% 32.9% 

Receive quarterly paper statements 28.3% 25.0% 20.7% 29.7% 24.0% 

Review annual participant statements 18.7% 16.2% 16.2% n/a 16.9% 

I don't review 2.8% 6.0% 4.4% 6.6% 4.4% 

Call the TSP ThriftLine 6.0% 4.2% 2.8% 3.2% 4.1% 

Notes: Based on all respondents, N=4,891. 

Fig. 3.2 How TSP Participants Usually Access Account Information by Age and Pay 

How do you usually access/receive your TSP account information?

Age Pay 

Less than 

Age 40 40s 

Age 50 

and Over 

Less than 

$40K 

$40K to 

$80K 

$80K and 

Over All - 2008 

Online from home 58.2% 57.5% 49.5% 50.2% 53.4% 55.6% 53.2% 

Online from work 37.0% 34.5% 30.7% 17.8% 33.0% 41.3% 32.9% 

Receive quarterly paper statements 22.3% 20.9% 26.1% 29.1% 23.9% 20.8% 24.0% 

Review annual participant statements 15.4% 16.9% 17.6% 18.2% 15.1% 18.3% 16.9% 

I don't review 6.0% 3.8% 4.0% 8.7% 4.0% 2.7% 4.4% 

Call the TSP ThriftLine 2.4% 2.9% 5.3% 5.4% 5.2% 2.0% 4.1% 

Notes: Based on all respondents, N=4,891. 

TSP participants generally find the information about the TSP useful and easy to access, 

although favorability on these items has declined since the initial survey was conducted 

in 2006-07 (See Figures 4.1 to 4.3). Three out of four respondents report that available 

TSP information helped to explain the plan’s benefits. Sixty-nine percent also note that 

this information aided with decisions regarding their TSP account. 

In general, survey respondents are satisfied with their ability to access information about 

their account and with the plan’s overall features. As in the prior 2006-07 survey, 

respondents report higher satisfaction with getting their information through the TSP 
13 

Web site rather than the ThriftLine (79 percent versus 62 percent, respectively, as shown 

in Figure 4.1). This is not a surprising finding since most respondents cite the Internet as 

their main method for accessing or receiving TSP account information. 

Fig. 4.1 Satisfaction with TSP Information 

76%

79%

69%

74%

76%

79%

83%

62%

69%

18%

15%

24%

20%

18%

14%

12%

31%

26%

6%

6%

7%

7%

6%

7%

5%

7%

5%

2008

2006

2008

2006

2008

2006

2008

2006

2008

2006

Favorable Neutral Unfavorable

 Notes: Based on all respondents, N=4,891. 

The information available about the TSP 

is helpful in explaining the benefits that I 

receive from the plan 

The information available about the TSP 

helps me make decisions about my TSP 

account 

The information provided in the annual 

participant statement is helpful in 

understanding my TSP account and 

investment performance 

Ability to access information about my 

account and general plan features on 

the TSP Web site 

Ability to access information about my 

account and general plan features 

through the automated TSP ThriftLine 

N/A 
14 

 

Fig. 4.2 Satisfaction with TSP Information by Retirement System 

TSP Information and changes in individual options

CSRS FERS Uniformed Service 

Favorable Unfavorable Favorable Unfavorable Favorable Unfavorable 

Information is helpful in explaining 

benefits that I receive from the TSP 80.7% 4.3% 75.1% 6.6% 72.8% 7.5% 

Information helps me make decisions 

about my TSP account 71.8% 5.7% 68.2% 7.7% 66.8% 7.8% 

The information provided in the 

annual participant statement is 

helpful in understanding my TSP 

account and investment performance 

81.4% 3.5% 75.1% 5.7% 73.2% 6.8% 

Ability to access information about 

my account and general plan features 

on the TSP Web site 

82.3% 5.3% 79.6% 6.6% 76.3% 9.2% 

Ability to access information about 

my account and general plan features 

through the automated TSP ThriftLine 

70.2% 4.8% 66.3% 6.5% 54.6% 9.3% 

Notes: Based on all respondents, N=4,891. 

Fig. 4.3 Satisfaction with TSP Information by Pay 

TSP Information and changes in individual options

Less than $40K $40K to $80K $80K and Over 

Favorable Unfavorable Favorable Unfavorable Favorable Unfavorable 

Information is helpful in explaining 

benefits that I receive from the TSP 69.8% 7.9% 75.9% 6.6% 78.1% 5.3% 

Information helps me make decisions 

about my TSP account 63.7% 9.5% 68.5% 7.0% 71.5% 6.3% 

The information provided in the 

annual participant statement is 

helpful in understanding my TSP 

account and investment performance 

71.0% 8.0% 76.0% 5.0% 79.0% 5.0% 

Ability to access information about 

my account and general plan features 

on the TSP Web site 

73.4% 7.9% 78.8% 7.2% 81.3% 7.6% 

Ability to access information about 

my account and general plan features 

through the automated TSP ThriftLine 

57.6% 9.1% 63.6% 6.7% 62.5% 7.2% 

Notes: Based on all respondents, N=4,891. 

Participants who take an active role in the management of their investment choices and 

savings rates today have the best opportunity to achieve retirement savings goals and 

expectations in the future. One step in actively managing an account is to review account 

information regularly. Overall, participants appear to be highly engaged in reviewing 
15 

their accounts. Over two-thirds of TSP participants review their account at least quarterly 

(See Figures 5.1 and 5.2). 

Fig. 5.1 Frequency that Participants Review Account by Retirement System (2008 vs. 2006) 

How often do you review your TSP account? 

Frequency that Participants Review Account 

Monthly or Semi-Annually or Rarely or 

Quarterly Annually Never 

2008 63.9% 19.1% 16.9% 

FERS 63.7% 16.8% 19.5% 

CSRS 69.4% 17.3% 13.4% 

Uniformed Services 60.6% 21.7% 17.7% 

2006 65.1% 17.0% 17.9% 

FERS 63.6% 14.1% 22.3% 

CSRS 67.0% 18.7% 14.3% 

Uniformed Services 64.6% 17.8% 17.6% 

Notes: Based on all respondents, N=4,891. 

Fig. 5.2. Frequency that Participants Review Account by Age and Pay 

How often do you review your TSP account? 

Frequency that Participants Review Account

Monthly or Semi-Annually or Rarely or 

Quarterly Annually Never 

Age

Less than Age 40 57.9% 19.2% 22.9% 

40s 61.7% 22.4% 16.0% 

Age 50 and Over 67.6% 17.5% 14.8% 

Pay

Less than $40K 53.7% 18.6% 27.7% 

$40K to $80K 65.0% 17.2% 17.8% 

$80K and Over 67.8% 21.2% 11.0% 

Notes: Based on all respondents, N=4,891. 
16 

Current TSP Design 

Survey participants were asked for their opinions about specific elements of the current 

TSP. Many respondents did not have an opinion or were uncertain about how to respond. 

The frequent selection of “Don’t Know/Not Applicable” by survey respondents may 

indicate that some plan options are not available to them. This response also may suggest 

a lack of knowledge about specific plan elements or the inability to spontaneously recall 

specific plan elements. 

FERS participants are the most satisfied with the level of matching contributions, while 

uniformed service participants are, not surprisingly, the most dissatisfied with the level of 

matching contributions (See Figure 6). Satisfaction with matching contributions by 

participants in systems other than the FERS suggests that they are either unaware that a 

match is not provided or are aware but accept this fact. FERS participants are generally 

content with the waiting period to receive agency contributions, as the majority of 

respondents (59 percent) responded “favorably” or “neutral”. 

A participant’s ability to withdraw money from his/her TSP account after separation from 

service and the ability to borrow from the account while actively employed is generally 

viewed favorably (See Figure 6). These two questions also received many “neutral” 

responses, suggesting that participants may be indifferent to the ability to withdraw or 

borrow money from their accounts. Also, a significant number of respondents replied 

“Don’t Know/Not Applicable” to these items, which re-enforces the high degree of 

indifference among respondents to withdraw or borrow money from their accounts. 

However, it may also reveal a degree of indifference because these participants have not 

yet had the need to investigate the availability of the benefits. 
17 

61%

12%

19%

34%

6%

12%

35%

30%

22%

29%

29%

24%

14%

11%

13%

25%

12%

21%

25%

17%

27%

20%

17%

24%

12%

10%

39%

18%

2%

8%

4%

2%

4%

2%

3%

5%

13%

67%

29%

24%

80%

60%

36%

51%

47%

48%

51%

48%

FERS

CSRS

US

FERS

CSRS

US

FERS

CSRS

US

FERS

CSRS

US

Favorable Neutral Unfavorable Don't Know/NA

Amount of 

agency/uniformed 

services matching 

contributions 

Waiting period 

for a new FERS employee

to be eligible for agency 

contributions 

Ability to borrow 

from my account while 

actively employed 

Ability to withdraw 

money after separation 

from service 

Fig. 6 Satisfaction with Characteristics of the TSP 
18 

Making Administrative Changes 

Survey respondents report a high level of satisfaction with their ability to make changes 

to their TSP accounts (See Figures 7.1 to 7.3). Eighty percent report that it is easy to 

make changes to their TSP investment allocations, and 79 percent note that it is easy to 

make changes to their contribution amounts, both very positive results despite slightly 

declining from the 2006-07 survey (by -4 and -2 percents, respectively). This is 

particularly noteworthy given the addition of the interfund transfer restrictions in 2008. 

Fig. 7.1 Ease of Administrative Changes 

80%

84%

79%

81%

13%

11%

13%

12%

7%

5%

8%

7%

2008

2006

2008

2006

Favorable Neutral Unfavorable

Notes: Based on all respondents, N=4,891. 

Fig. 7.2 Ease of Administrative Changes by Retirement System 

TSP Information and changes in individual options

CSRS FERS Uniformed Service 

Favorable Unfavorable Favorable Unfavorable Favorable Unfavorable 

It's easy to make changes to the 

way my TSP money is invested 83.8% 5.2% 78.7% 8.0% 78.4% 7.8% 

It's easy to make changes to the 

amount of pay I contribute to the 

TSP 

80.6% 5.4% 79.1% 8.5% 77.6% 8.6% 

Notes: Based on all respondents, N=4,891. 

Fig. 7.3 Ease of Administrative Changes by Pay 

TSP Information and changes in individual options

Less than $40K $40K to $80K $80K and Over 

Favorable Unfavorable Favorable Unfavorable Favorable Unfavorable 

It's easy to make changes to the way 

my TSP money is invested 73.8% 8.7% 80.5% 7.7% 82.6% 5.9% 

It's easy to make changes to the 

amount of pay I contribute to the TSP 75.1% 7.7% 79.1% 7.5% 80.4% 8.1% 

Notes: Based on all respondents, N=4,891. 

It's easy to make changes to 

the way my TSP money is 

invested 

It's easy to make changes to 

the amount of pay I contribute 

to the TSP 
19 

 Asset Allocation in the TSP 

In addition to employee contributions to retirement accounts, how funds are invested over 

a participant’s career can significantly affect the level of funds available at retirement. 

Similar to private sector defined contribution plans, the responsibility for making 

investment decisions rests with TSP participants. Like other employer-sponsors of selfdirected savings plans, the FRTIB seeks to ensure that TSP participants have sufficient 

education and information in order to make informed contribution and investment 

decisions. If participants do not make asset allocation decisions, funds in their accounts 

are invested in the G Fund, which invests in short-term U.S. Treasury securities with no 

risk of loss of principal. 

The survey asked participants to describe their approach for investing in the TSP. 

Overall, the distribution of risk approaches is concentrated between moderate risk and 

balanced – comprising nearly three in five responses (See Figure 8). However, more than 

a third of TSP participants identify their approach as low risk or no risk, which is 

appreciably higher than indicated in the 2006-2007 survey (36.1% vs. 28.3%). Again, 

this could represent a shift to a more conservative approach due to fear and concern over 

the turbulent financial markets. It could also be indicative of an older population of 

respondents in this year’s survey. However, slightly more than 10 percent of respondents 

indicate that they follow a high risk approach to investing their TSP funds, which is 

comparable to the 2006-2007 survey results. 

The approach taken by TSP participants is highly linked to the respondent’s age. Based 

on survey responses, younger participants, as expected, are taking on more risk in 

investing their TSP assets. These responses are in line with what professional financial 

advisers typically suggest for employees, who are early in their careers and have a long 

investment horizon. These younger employees are well-matched to invest a higher 

proportion of their retirement assets in equity funds and shift to more stable fixed-income 

assets as they approach retirement. This common approach – known as time 
20 

diversification – is based on the principle that the longer the time horizon, the greater an 

investor’s ability to weather short-term declines. 

Fig. 8 Self-Reported Approach to Investing TSP Assets by Retirement System, Age and 

Pay 

How would you describe your approach for investing the money in your TSP account? 

 High Risk Moderate Risk Balanced Low Risk No Risk 

All - 2008 10.7% 25.7% 27.6% 20.5% 15.6% 

All - 2006 11.8% 28.5% 31.5% 18.6% 9.7% 

Retirement System

CSRS 9.1% 18.6% 24.6% 26.3% 21.4% 

FERS 10.8% 21.9% 28.4% 22.5% 16.4% 

Uniformed Service 11.6% 32.4% 29.1% 15.6% 11.4% 

Age

Less than Age 40 17.1% 34.3% 25.7% 13.8% 9.2% 

40s 12.5% 33.4% 28.7% 15.2% 10.3% 

Age 50 and Over 7.4% 18.5% 27.9% 25.8% 20.5% 

Pay

Less than $40K 6.7% 19.6% 27.2% 25.6% 20.8% 

$40K to $80K 11.5% 24.7% 27.0% 20.2% 16.7% 

$80K and Over 11.8% 29.7% 28.3% 18.4% 11.8% 

Notes: Based on all respondents, N=4,891 for 2008 and N=5,053 for 2006. 

TSP participants can select from five individual investment funds that provide a wide 

range of investment risks to meet a wide range of participant objectives. The G Fund is 

the most conservative option and is based on investing in short-term Treasury securities 

without risk of loss. The F Fund, a conservative fixed income option that tracks the 

Barclays Capital U.S. Aggregate Bond Index (formerly Lehman Brothers U.S. Aggregate 

(LBA) Index) , requires investors to bear market and credit risks not exhibited by the G 

Fund. TSP’s equity options are provided by the C Fund, S Fund and I Fund. The C 

Fund invests in a fund of medium-to-large U.S. companies that replicates the S&P 500 

Index. The S Fund invests in a broad market fund of small- and medium-sized U.S. 

companies that track closely to the Dow Jones Wilshire 4500 Completion Index. The I 

Fund invests in a stock index fund that replicates the Morgan Stanley Capital 

International EAFE Index, a broad international market index comprised primarily of 

large companies in 21 developed countries. For participants who do not have the time, 

experience or interest in managing their accounts, the TSP also offers five L Funds – 

Lifecycle Funds – with differing time horizons. Each L Fund invests in a mix of the five 
21 

individual TSP funds described above. The mix is chosen by experts based on each 

fund’s time horizon. 

Survey results indicate a very strong link between participant risk approaches and actual 

investment choices (See Figure 9). As appropriate, respondents who indicate a high or 

moderate investment risk approach report a much higher share of equities in their actual 

TSP account. Those who chose a very aggressive or high risk strategy hold only 19 

percent of their assets in the more conservative G Fund and F Fund. Conversely, the 

majority of those who indicate a low or no risk investment strategy primarily invest in the 

G Fund. Respondents, who indicate a moderate or balanced approach to risk, hold the 

highest share of their TSP assets in the L Fund, while those, who report being very 

cautious, hold the lowest. 

Fig. 9 TSP Investment Allocations Aligned with Self-Reported Risk Tolerances 

 Percentage of Total TSP Account Balance by Fund 

TSP Account 

Balance 

G Fund F Fund C Fund S Fund I Fund L Fund Average Median 

High Risk 2008 16.4% 2.9% 29.8% 16.7% 22.3% 9.5% $40,627 $19,912 

2006 17.4% 2.1% 30.7% 18.1% 21.7% 9.9% $38,831 $12,770 

Moderate Risk 2008 24.0% 5.1% 24.7% 12.7% 11.6% 19.6% $40,187 $17,820 

2006 25.0% 3.3% 31.1% 14.4% 13.9% 12.2% $40,367 $18,113 

Balanced 2008 42.8% 6.4% 16.1% 6.5% 6.6% 19.4% $42,522 $21,952 

2006 41.8% 6.1% 22.0% 7.3% 6.8% 15.6% $41,941 $18,583 

Low Risk 2008 67.6% 7.2% 7.2% 2.3% 2.3% 10.7% $48,382 $23,407 

2006 65.9% 4.5% 13.7% 2.1% 2.5% 10.5% $37,126 $16,257 

No Risk 2008 87.7% 2.4% 3.2% 0.9% 0.7% 3.6% $50,475 $29,114 

 2006 90.9% 1.1% 4.3% 0.4% 0.8% 2.4% $36,372 $20,894 

Notes: Based on all respondents, N=4,891 for 2008 and N=5,053 for 2006. 
22 

From an investment perspective, an asset allocation of about 70 percent to equities 

appears reasonable in light of the long-term retirement objectives of most defined 

contribution savings plans. Employee Benefit Research Institute (EBRI) and the 

Investment Company Institute (ICI) collaborated and estimated the average asset 

allocation of funds in private sector defined contribution accounts for various years 

through 2007. Based on their estimates, at year-end 2007, equity securities – equity 

funds, the equity portion of balanced funds and company stock – represented about twothirds of 401(k) plan participants’ assets.2

 On average, the largest portion was invested 

directly in equity funds at almost 48 percent. Direct exposure to equities is particularly 

high among younger private sector employees (under age 40) with 52 percent investing in 

equity funds compared to employees in their 60s who invest in equity funds at 38 percent. 

Older private sector employees invest a much higher share of their assets in fixed-income 

securities, which is consistent with the time-diversification approach. 

However, survey respondents, on average, invest far less in equities. Overall, TSP 

participants invest nearly an equal share of their assets in fixed-income securities and 

equity funds (See Figure 10.1 to 10.6). The average TSP account – that equally weights 

each participant’s investment allocation – has more than half (54.1%) of its assets 

invested in the G Fund and F Fund. The fixed-income share is lower among participants 

age 30 to 49 and rises as participants approach retirement. However, the share of TSP 

funds invested in equities – particularly the C Fund – rises as years of service with 

Federal government/uniformed services grows. In particular, the share of assets invested 

in the G Fund drops significantly after participants reach two years of service and 

declines even further at five years of service. Lastly, TSP participants who rarely or 

never check their account balance invest a much greater share of assets in the G Fund, 

while participants, who review their accounts more frequently, invest a much greater 

share of assets in the equity funds and the L Funds. 

 

2

 EBRI Issue Brief, “401(k) Plan Asset Allocation, Account Balances, and Loan Activity in 2007, No. 324, 

December 2008. 
23 

One explanation for this relatively low share of TSP participants invested in equities may 

be attributed to Federal employees being more conservative investors than private sector 

employees. There is also some sense that Federal employees, who take great pride in 

their jobs, may view the G Fund like private sector employees view their company’s 

stock. An alternative explanation may be the high level of participant inertia with a 

disproportionate share of participants not making active investment decisions and instead 

settling for the default portfolio – 100 percent G Fund. 

Fig. 10.1 Average Asset Allocation of TSP Accounts by Age 

Percentage of Total TSP Account Balance by Fund TSP Account 

Balance 

G Fund F Fund C Fund S Fund I Fund L Fund Average Median 

Less than Age 30 54.6% 2.4% 8.4% 6.8% 9.5% 16.6% $6,182 $2,391 

30 to 39 38.8% 3.9% 15.2% 9.6% 10.7% 19.0% $14,014 $6,908 

40 to 49 40.8% 5.5% 17.7% 10.1% 8.1% 15.2% $34,084 $16,951 

50 to 59 50.6% 6.1% 15.9% 5.9% 7.0% 12.2% $51,388 $33,877 

Age 60 and Over 59.0% 5.1% 15.9% 4.4% 4.6% 9.4% $66,935 $45,299 

Participant-Weighted1 49.0% 5.1% 15.6% 7.1% 7.4% 13.6% 

Dollar- Weighted 51.2% 6.0% 18.3% 6.0% 6.0% 12.4% 

 $41,992 $19,956 

Notes: 1 Equal-weighted by share of assets in participant account. Distribution of funds is based on administrative records 

for all respondents. N=4,891. 

Fig. 10.2 Average Asset Allocation of TSP Accounts by Tenure 

Percentage of Total TSP Account Balance by Fund TSP Account 

Balance 

G Fund F Fund C Fund S Fund I Fund L Fund Mean Median 

Less than 2 years 69.3% 1.6% 4.5% 3.4% 4.0% 17.1% $5,393 $1,787 

2 to 5 years 52.6% 2.9% 9.9% 5.6% 7.8% 19.9% $9,204 $3,376 

5 to 15 years 45.1% 4.3% 14.4% 8.4% 9.3% 16.0% $22,598 $9,282 

15 to 25 years 42.8% 5.7% 17.7% 9.9% 8.4% 12.8% $42,434 $17,382 

25+ years 50.5% 5.9% 17.3% 5.8% 6.5% 11.6% $60,409 $42,907 

Participant-Weighted1 49.0% 5.1% 15.6% 7.1% 7.4% 13.6% 

Dollar- Weighted 51.2% 6.0% 18.3% 6.0% 6.0% 12.4% 

 $41,992 $19,956 

Notes: 1 Equal-weighted by share of assets in participant account. Distribution of funds is based on administrative records 

for all respondents. N=4,891. 
24 

Fig. 10.3 Average Asset Allocation of TSP Accounts by Pay 

Percentage of Total TSP Account Balance by Fund TSP Account 

Balance 

G Fund F Fund C Fund S Fund I Fund L Fund Mean Median 

Less than $40K 63.4% 3.8% 10.7% 4.7% 5.2% 11.1% $18,680 $5,851 

$40K to $60K 52.2% 4.2% 14.1% 5.9% 7.3% 12.7% $29,548 $14,847 

$60K to $80K 45.7% 5.5% 15.5% 7.4% 7.8% 15.7% $37,637 $22,150 

$80K to $100K 45.2% 5.9% 17.1% 8.2% 7.9% 13.2% $54,683 $32,121 

$100K and Over 38.3% 5.7% 19.8% 9.8% 9.2% 15.5% $67,351 $40,233 

Participant-Weighted1 49.0% 5.1% 15.6% 7.1% 7.4% 13.6% 

Dollar- Weighted 51.2% 6.0% 18.3% 6.0% 6.0% 12.4% 

 $41,992 $19,956 

Notes: 1 Equal-weighted by share of assets in participant account. Distribution of funds is based on administrative records 

for all respondents. N=4,891. 

Fig. 10.4 Average Asset Allocation of TSP Accounts in the G Fund and F Fund by 

Participant Age 

50%

57%

51%

45%

42%

59%

54%

64%

57%

43%

57%

46%

All

Age 60 and Over

50 to 59

40s

30 to 39

Less than Age 30 2008

2006

Notes: Distribution of funds is based on administrative records for all respondents. Based on all respondents, N=4,891 for 

2008 and N=5,053. 
25 

Fig. 10.5 Average Asset Allocation of TSP Accounts in the G Fund and F Fund by 

Participant Age and Tenure 

Percentage of Total TSP Account Balance Invested in The G & F Funds 

Less than 

2 years 

2 to 5 

years 

5 to 15 

years 

15 to 25 

years 25+ years All 

Less than Age 30 62.9% 59.4% 53.2% - - 57.0% 

30 to 39 65.4% 42.4% 40.5% 37.8% - 42.7% 

40s 80.3% 48.9% 46.5% 42.1% 47.1% 46.2% 

50 to 59 81.7% 52.3% 63.1% 57.6% 54.7% 56.7% 

Age 60 and Over 69.4% 82.0% 66.4% 68.8% 62.0% 64.1% 

All 70.9% 55.5% 49.4% 48.6% 56.4% 54.2% 

Notes: Distribution of funds is based on administrative records for all respondents. N=4,891. 

Fig. 10.6. Average Asset Allocation of TSP Accounts by Frequency that Participants 

Review Account 

Percentage of Total TSP Account Balance by Fund 

Frequency that Participants Review 

Account G Fund F Fund C Fund S Fund I Fund L Fund 

Monthly or Quarterly 46.3% 5.4% 15.0% 7.5% 8.4% 14.8% 

Semi-Annually or Annually 45.6% 5.2% 18.7% 8.1% 7.0% 13.7% 

Rarely or Never 62.5% 4.0% 14.1% 4.8% 4.3% 9.0% 

Participant-Weighted Average1 49.0% 5.1% 15.6% 7.1% 7.4% 13.6% 

Dollar- Weighted 51.2% 6.0% 18.3% 6.0% 6.0% 12.4% 

Notes: 1 Equal-weighted by share of assets in participant account. Distribution of funds is based on administrative records 

for all respondents. Based on all respondents, N=4,891. 

The extent to which TSP investment allocations differ based on the resources participants 

used in making their fund allocations may provide some insight on how informed their 

choices have been. In fact, respondents who received professional advice or reviewed the 

TSP web site or publications tend to choose a more risky asset portfolio with a greater 

share of their TSP account in equities (See Figure 11.1 to 11.3). These findings indicate 

that TSP participants are actively using the educational materials provided through 

the TSP. These materials are also playing an important role in developing financial 

literacy and promoting sound investment decisions among TSP participants. Higher 

income participants are more likely to seek professional advice on their accounts (See 

Figure 11.2). 
26 

Fig. 11.1 Resources Used by TSP Participants to Determine Investment Strategy by 

Retirement System 

How did you determine where to invest your TSP money? 

CSRS FERS 

Uniformed 

Services All - 2006 All - 2008 

Reviewed TSP Web site/publications 25.4% 22.0% 29.4% 33.1% 26.3% 

Left in G Fund 20.4% 23.0% 14.9% 21.2% 18.6% 

Selected L Fund 13.1% 18.4% 18.8% 16.8% 17.1% 

Received advice from a financial professional 13.2% 13.5% 14.9% 14.3% 14.1% 

Received advice from family/friends 11.5% 13.5% 7.6% 11.9% 10.3% 

Received advice from co-workers 12.6% 10.8% 6.4% 11.9% 9.3% 

Spoke with agency/uniformed services rep 1.8% 1.7% 2.6% 2.2% 2.1% 

None of above 15.6% 14.7% 14.8% n/a 15.0% 

Notes: Based on all respondents, N=4,891 for 2008 and N=5,053 for 2006.

Fig. 11.2 Resources Used by TSP Participants to Determine Investment Strategy by Age 

and Pay 

How did you determine where to invest your TSP money? 

Age Pay 

Less than 

Age 40 40s 

Age 50 and 

Over 

Less than 

$40K 

$40K to 

$80K 

$80K and 

Over All 

Reviewed TSP Web site/publications 25.2% 30.5% 25.1% 18.5% 25.5% 31.3% 26.3% 

Left in G Fund 17.2% 14.2% 21.3% 30.3% 18.9% 12.1% 18.6% 

Selected L Fund 22.6% 19.8% 13.7% 13.2% 17.7% 18.7% 17.1% 

Received advice from a financial professional 15.3% 15.1% 13.3% 9.0% 13.3% 17.8% 14.1% 

Received advice from family/friends 13.7% 9.4% 9.4% 9.9% 12.1% 8.5% 10.3% 

Received advice from co-workers 8.6% 9.6% 9.4% 8.7% 11.3% 7.3% 9.3% 

Spoke with agency/uniformed services rep 2.3% 2.1% 2.1% 2.9% 2.3% 1.6% 2.1% 

None of above 13.4% 13.9% 16.1% 17.9% 13.8% 15.1% 15.0% 

Notes: Based on all respondents, N=4,891.

Fig. 11.3 Resources Used by TSP Participants to Determine Investment Strategy and 

Corresponding Assets Invested in the G and F Funds 

How did you determine where to invest your TSP money? 

 Percentage of Assets invested in the 

G and F Funds 

Resources 

Percentage 

That Use 

Resource Use Resource 

Don’t Use 

Resource 

Reviewed TSP Web site/publications 26.3% 47.4% 56.6% 

Left in G Fund 18.6% 91.1% 45.8% 

Selected L Fund 17.1% 27.6% 59.7% 

Received advice from a financial professional 14.1% 38.9% 56.7% 

Received advice from family/friends 10.3% 52.7% 54.4% 

Received advice from co-workers 9.3% 54.9% 54.1% 

Spoke with agency/uniformed services rep 2.1% 66.5% 53.9% 

None of above 15.0% 56.2% 53.8% 

Notes: Distribution of funds is based on administrative records for all respondents. N=4,891. 
27 

Withdrawals and Rollovers 

When a Federal employee or uniformed service member leaves their job with the Federal 

Government or service, there are a number of options he/she can make regarding his/her 

TSP account balance. Participants with an account balance of $200 or greater may leave 

their funds in the TSP. They may also withdraw their account as a single payment, a 

series of monthly payments, a life annuity, or as any combination of these fullwithdrawal options. Separated participants in some cases may transfer their withdrawal 

payments to an eligible employer plan or IRA. All separated participants must elect a full 

withdrawal option at age 701⁄2. 

When asked about their plans for their TSP account balance when they leave service, 

exactly half of all respondents plan to leave their funds with the TSP (See Figures 12.1 to 

12.3). This is particularly the case among participants of the CSRS and uniformed 

services. Respondents with higher account balances also plan to keep their money with 

the TSP. It is not surprising that respondents, who are not actively working for the 

Federal Government or uniformed services, are more inclined to leave their funds with 

the TSP, since in many regards they have already made this decision. Those who have 

separated from service and withdrawn their account from the TSP would not have been 

solicited to complete this survey. However, only 14 percent of respondents plan to roll 

over all or some of their account balance to an IRA and few plan to transfer their account 

to another employer. Nearly one in five respondents indicate wanting to receive monthly 

payments from the TSP. This is most prevalent among FERS participants. However, an 

equal share are unsure what they will do with their account funds. Very few indicate 

plans to purchase a TSP annuity. 
28 

Fig. 12.1 Plans for TSP Account Balance When Separate From Service by Retirement 

System

What do you plan to do with your TSP account balance when you separate from service, or what have you already done if 

you are currently separated from service?

CSRS FERS 

Uniformed 

Services All 

Leave it in the TSP 53.4% 36.5% 55.7% 50.0% 

Receive monthly payments from the TSP 20.2% 26.9% 10.0% 17.4% 

Don't know 13.6% 24.5% 15.5% 17.3% 

Roll over all or some to an IRA 11.3% 11.1% 17.3% 14.0% 

Take a single payment in cash 8.6% 5.0% 4.3% 5.7% 

Combination single payment and/or annuity 

payment 5.8% 6.8% 4.2% 5.3% 

Roll over all or some to a 401(k) plan of another 

employer 0.4% 2.6% 7.8% 4.3% 

Purchase a TSP annuity 3.4% 3.6% 1.5% 2.6% 

Notes: Based on all respondents, N=4,891.

Fig. 12.2 Plans for TSP Account Balance When Separate From Service by TSP Account 

Balance

What do you plan to do with your TSP account balance when you separate from service, or what have you already done if 

you are currently separated from service?

TSP Account Balance 

Less than 

$5K 

$5K to 

$25K 

$25K to 

$50K 

$50K to 

$100K 

$100K 

and 

Over All 

Leave it in the TSP 39.9% 51.7% 54.5% 52.3% 57.5% 50.0% 

Receive monthly payments from the TSP 16.0% 15.2% 19.9% 19.1% 19.7% 17.4% 

Don't know 22.4% 15.6% 15.9% 16.8% 13.7% 17.3% 

Roll over all or some to an IRA 14.9% 15.7% 10.2% 14.0% 12.7% 14.0% 

Take a single payment in cash 8.6% 5.9% 5.6% 3.4% 2.6% 5.7% 

Combination single payment and/or 

annuity payment 4.3% 5.6% 5.3% 5.7% 6.4% 5.3% 

Roll over all or some to a 401(k) plan of 

another employer 7.0% 5.9% 2.9% 1.3% 0.8% 4.3% 

Purchase a TSP annuity 2.2% 1.8% 2.4% 3.7% 4.3% 2.6% 

Notes: Based on all respondents, N=4,891.
29 

Fig. 12.3 Plans for TSP Account Balance When Separate From Service by Employment 

Status

What do you plan to do with your TSP account balance when you separate from service, or what have you already done if 

you are currently separated from service?

Active Not Active 

(N=3,412) 

Retired

(N=568)

Not Retired

(N=911) All

Leave it in the TSP 41.4% 70.6% 69.4% 50.0% 

Receive monthly payments from the TSP 18.8% 21.7% 9.4% 17.4% 

Don't know 22.0% 4.4% 7.9% 17.3% 

Roll over all or some to an IRA 16.1% 5.6% 11.1% 14.0% 

Take a single payment in cash 6.3% 4.2% 4.6% 5.7% 

Combination single payment and/or annuity 

payment 6.1% 4.8% 3.0% 5.3% 

Roll over all or some to a 401(k) plan of another 

employer 4.1% 0.0% 7.9% 4.3% 

Purchase a TSP annuity 3.2% 0.7% 1.5% 2.6% 

Notes: Based on all respondents, N=4,891.

The IRS restricts when an individual can withdrawal funds from a tax-deferred savings 

account primarily to discourage leakage from these programs. Generally, withdrawals 

may begin at age 591⁄2 if still employed or, in some cases, at age 55 for those who 

terminate employment after that age. If the individual is under age 55 when employment 

terminates (or 591⁄2 if still employed), a 10% excise tax is usually imposed on 

withdrawals. However, the IRS also requires individuals to withdraw a minimum amount 

from their account beginning at age 701⁄2. 

When asked about the age at which they plan to withdrawal money from their TSP 

account, most respondents are unsure (See Figures 13.1 to 13.3). However, for those 

who do know, most plan to wait until they are required to withdrawal funds at age 701⁄2. 

This is most prevalent among CSRS participants and less so among FERS participants. 

This is not surprising since the results above indicate that the TSP tends to be more of a 

supplemental plan to participants of the CSRS and uniformed services, whereas the TSP 

account is viewed more as the primary source of retirement income among FERS 

participants. Likewise, later withdrawals are most evident among those who are older or 

already retired and among those with higher pay. Very few respondents indicate a desire 

to start withdrawing their funds before age 55, although it is more common among 

younger and lower paid respondents. 
30 

Fig. 13.1 Anticipated Age to Withdraw Money from TSP Account by Retirement System

At what age do you anticipate starting to withdraw money from your TSP account?

CSRS FERS 

Uniformed 

Services All 

Don't Know 20.2% 26.4% 23.3% 23.2% 

At 70.5 30.8% 15.1% 20.9% 22.2% 

60 to 64 18.0% 19.0% 19.1% 18.8% 

66 to 70 11.7% 18.2% 15.4% 15.1% 

At 65 5.9% 9.9% 10.9% 9.2% 

55 to 59 7.0% 7.4% 6.8% 7.0% 

I've already started withdrawals 5.9% 2.9% 0.8% 2.8% 

Before I'm 55 0.4% 1.1% 2.9% 1.7% 

Notes: Based on all respondents, N=4,891. 

Fig. 13.2 Anticipated Age to Withdraw Money from TSP Account by Employment Status

At what age do you anticipate starting to withdraw money from your TSP account?

Active Not Active 

(N=3,372) 

Retired

(N=568)

Not Retired

(N=911) All

Don't Know 25.0% 17.9% 19.8% 23.2% 

At 70.5 17.6% 40.7% 27.2% 22.2% 

60 to 64 20.9% 9.4% 17.0% 18.8% 

66 to 70 15.7% 7.6% 17.6% 15.1% 

At 65 9.8% 3.9% 10.2% 9.2% 

55 to 59 8.3% 3.7% 4.2% 7.0% 

I've already started withdrawals 0.7% 16.5% 2.1% 2.8% 

Before I'm 55 2.0% 0.2% 1.8% 1.7% 

Notes: Based on all respondents, N=4,891.

Fig. 13.3 Anticipated Age Non-Retirees to Withdraw Money from TSP Account by Age and 

Pay

At what age do you anticipate starting to withdraw money from your TSP account?

Age Pay 

Less than 

Age 40 40s 

Age 50 

and Over 

Less 

than 

$40K 

$40K to 

$80K 

$80K and 

Over All 

Don't Know 31.6% 21.8% 20.7% 33.1% 26.0% 18.1% 23.8% 

At 70.5 10.3% 15.7% 26.8% 16.5% 13.6% 26.9% 19.6% 

60 to 64 18.9% 23.7% 18.8% 16.4% 23.2% 18.4% 20.1% 

66 to 70 10.3% 17.0% 18.9% 13.3% 14.5% 19.0% 16.2% 

At 65 12.7% 10.0% 8.4% 8.0% 10.6% 10.0% 9.9% 

55 to 59 10.5% 9.5% 4.6% 6.6% 9.3% 5.9% 7.4% 

Already started withdrawals 0.7% 0.5% 1.4% 1.7% 1.1% 0.5% 1.0% 

Before I'm 55 4.8% 1.8% 0.5% 4.5% 1.6% 1.2% 1.9% 

Notes: Based on respondents who are not retired, N=4,283. 
31 

For employees who were previously employed with another organization and participated 

in a tax-deferred savings plan, the TSP permits individuals to transfer their funds from a 

prior eligible employer plan to their TSP account. When asked about whether or not they 

would be willing to do so, there are somewhat mixed views on what respondents would 

do (See Figures 14.1 and 14.2). Roughly one in five respondents indicates they would 

consider rolling another account into the TSP and 4 percent have actually done so. 

Conversely, over 13 percent would not consider doing so and 7 percent, who had the 

chance, rolled their funds from a previous employer to another account (not the TSP). In 

total, roughly the same number has or would consider rolling funds to the TSP as those 

who have not or would not consider doing so. Participants who have already transferred 

funds into the TSP or would consider doing so are more highly satisfied with the TSP. 

Conversely, participants who would not consider transferring funds or have already 

transferred funds to an account other than the TSP tend to be less highly satisfied with the 

TSP (See Figure 15). However, overall, most respondents either do not have funds in 

another account or are not sure what they would do. 

Fig. 14.1 Transferring Funds into TSP by Retirement System

Which of the following describes action you have taken or would consider taking regarding an account from another 

employer’s 401(k) or from a traditional IRA?

CSRS FERS 

Uniformed 

Services All 

Not applicable (Never had a 401(k) or IRA) 53.0% 35.4% 26.4% 36.4% 

Don't Know 22.0% 24.4% 21.3% 22.5% 

I would consider rolling another account into my 

TSP account 10.6% 18.5% 23.3% 18.4% 

I would not consider rolling another account into 

my TSP account 10.5% 8.6% 19.6% 13.6% 

I have already rolled another account into 

another account (not TSP) 1.9% 9.1% 9.8% 7.5% 

I have already rolled another account into my 

TSP account 2.6% 6.5% 2.9% 4.0% 

Notes: Based on active employees, N=3,372. Multiple responses allowed. 
32 

Fig. 14.2 Transferring Funds into TSP by Age and Pay

Which of the following describes action you have taken or would consider taking regarding an account from another 

employer’s 401(k) or from a traditional IRA?

Age Pay 

Less than 

Age 40 40s 

Age 50 

and Over 

Less 

than 

$40K 

$40K to 

$80K 

$80K and 

Over All 

Not applicable (Never had a 401(k) or 

IRA) 34.2% 30.3% 41.0% 32.8% 40.4% 33.6% 36.4% 

Don't Know 21.2% 22.5% 23.2% 27.8% 23.9% 18.5% 22.5% 

I would consider rolling another 

account into my TSP account 21.0% 23.0% 14.7% 20.0% 16.1% 20.5% 18.4% 

I would not consider rolling another 

account into my TSP account 13.9% 15.1% 12.7% 10.4% 11.4% 17.5% 13.6% 

I have already rolled another account 

into another account (not TSP) 8.1% 8.4% 6.7% 7.8% 6.7% 8.5% 7.5% 

I have already rolled another account 

into my TSP account 4.3% 4.4% 3.6% 2.8% 4.2% 4.1% 4.0% 

Notes: Based on active employees, N=3,372. Multiple responses allowed. 

Fig. 15 TSP Satisfaction by Actions Taken or Considered for Transferring Funds into TSP 

93%

87%

71%

79%

81%

80%

83%

82%

Action Taken or Considered

No Action Taken or Considered

 

Notes: Based on active employees, N=3,372. Multiple responses allowed. 

Rates of “High” TSP Satisfaction 

I have already rolled another 

account into my TSP account 

I would consider rolling another 

account into my TSP account 

I would not consider rolling 

another account into my TSP 

account 

I have already rolled another 

account into another account (not 

TSP) 
33 

 Part B: Savings and Contributions to the TSP 

Level of TSP Participation 

All survey respondents currently have a TSP account with a non-zero balance. 

Employees in the Federal Employees’ Retirement System (FERS) can make salary 

deferrals immediately after being hired. In addition, usually 6 to 12 months after they are 

hired by the Federal Government, they become eligible to receive a one percent nonmatching contribution as well as matching contributions. Respondents to this survey 

include FERS participants who deferred a portion of their pay and also FERS participants 

who do not contribute but receive the Agency Automatic (1%) Contributions. Civil 

Service Retirement System (CSRS) and uniformed service participants can make salary 

deferral contributions immediately after being hired, but do not receive agency 

contributions.3

 As such, this survey includes only CSRS or uniformed service 

participants who have contributed a portion of their pay to the TSP at some point during 

their career. 

TSP participants were asked whether they had contributed to the TSP over the last two 

years. The survey reflects a FERS employee participation rate of 93.2 percent (See 

Figures 16.1 to 16.3).4 This rate is higher than the 87.1 percent reported by respondents 

of the 2006 survey. In part, this can be explained by the current respondents being 

slightly older with longer tenure than in the 2006 respondents – both factors are linked to 

higher participation. Also, participation rates among FERS participants are quite a bit 

higher than the average 401(k) plan, which typically has approximately three quarters of 

their employees contributing money to the plan at any one time.5

 However, it is 

important to note that the lowest FERS participation rates are for participants age 50 and 

 

3

 While there is a pilot program currently in place for a small group of U.S. Army members to receive 

matching agency contributions, none of these members participated in this survey. 4

 The participation rate is significantly higher among FERS survey respondents than all FERS employees. 

The all FERS participation rate is based on administrative records and reflects current contribution 

decisions, while the rate from this survey is based on whether or not respondents’ contributed to the TSP at 

any point over the last two years. 

5

 Average plan-weighted participation in the private sector is 74 percent and rates among large companies 

with over 5,000 employees are typically lower at 67 percent. See Vanguard, 2007. How America Saves 

2007, A Report on Vanguard 2006 Defined Contribution Plan Data. 

www.vanguardretirementresearch.com. 
34 

older with pay less than $40K, which likely represent the long-term and lower paid 

segment of the FERS workforce. But participation rates among the lower paid segment 

of FERS participants are significantly higher than in 2006 – rising by nearly 10 

percentage points. 

Fig. 16.1 FERS TSP Participation Rates by Age and Gender

In the past two years, have you contributed to the TSP? 

Less than 

Age 40 40s 

Age 50 and 

Over All 

All 

 2008 95.5% 94.2% 91.0% 93.2%

 2006 90.0% 90.3% 82.7% 87.1%

Males 

 2008 97.4% 94.6% 91.5% 93.9%

 2006 93.1% 92.7% 81.0% 87.4%

Females 

 2008 93.5% 93.8% 90.2% 92.3%

 2006 87.2% 87.2% 85.5% 86.6%

Notes: Based on active FERS participants, N=1,072 in 2008 and N=1,203 in 2006. 

Fig. 16.2 FERS TSP Participation Rates by Pay and Gender

In the past two years, have you contributed to the TSP? 

 Pay Groups 

 Less than $40K $40K to $80K $80K and Over 

All-2008 87.4% 93.9% 95.6% 

All-2006 77.6% 89.5% 94.7% 

All - Less than Age 40 87.1% 96.9% 100.0% 

All -40s 90.5% 93.3% 97.7% 

All -Age 50 and Over 85.4% 91.7% 92.6% 

 

Males-2008 89.3% 95.0% 94.2% 

Males-2006 78.3% 88.3% 94.3% 

Males- Less than Age 40 90.5% 98.0% 100.0% 

Males- 40s 93.8% 92.8% 98.0% 

Males- Age 50 and Over 86.0% 93.8% 90.1% 

 

Females-2008 86.0% 92.7% 98.0% 

Females-2006 76.9% 91.1% 95.7% 

Females-Less than Age 40 85.4% 95.7% 100.0% 

Females-40s 88.5% 94.0% 97.2% 

Females-Age 50 and Over 84.6% 88.9% 97.7% 

Notes: Based on active FERS participants, N=1,072 in 2008 and N=1,203 in 2006.
35 

Fig. 16.3 FERS TSP Participation Rates by Age and Tenure

In the past two years, have you contributed to the TSP?

Tenure Group (Years) 

Less than 2 2 to 5 5 to 15 15+ 

All-2008 92.0% 92.6% 92.9% 94.5% 

All-2006 82.3% 84.2% 89.8% 90.0% 

All-Less than Age 40 96.7% 95.8% 94.5% 100.0% 

All-40s 89.1% 97.0% 93.7% 95.0% 

All-Age 50 and Over 87.4% 84.1% 91.1% 93.9% 

 

Males-2008 94.9% 94.3% 93.0% 93.4% 

Males-2006 84.4% 84.4% 90.9% 88.4% 

Males-Less than Age 40 96.8% 100.0% 95.9% 100.0% 

Males-40s 100.0% 92.3% 92.9% 93.3% 

Males-Age 50 and Over 90.7% 87.0% 91.0% 93.0% 

 

Females-2008 88.8% 91.0% 92.9% 96.5% 

Females-2006 80.0% 83.9% 88.5% 93.5% 

Females-Less than Age 40 96.6% 91.9% 93.4% - 

Females-40s 80.8% 100.0% 94.6% 97.8% 

Females-Age 50 and Over 82.9% 81.0% 91.1% 95.7% 

Notes: Based on active FERS participants, N=1,072 in 2008 and N=1,203 in 2006. 

Among non-contributors, the top reason participants cite for not currently contributing to 

the TSP is that they don’t have enough money to do so (See Figures 17.1 to 17.3). This is 

potentially a sign of the times, as this response increased among all segments of the 

Federal workforce, especially among CSRS participants. CSRS respondents also cite 

they are saving in other ways as a reason for not participating in the TSP, and this is the 

top reason among uniformed service participants. Likewise, almost one in five 

participants of the uniformed services indicates the lack of matching contributions as the 

reason for not contributing to the TSP. Despite the economic conditions, only 6 percent 

cite hardship withdrawals that suspended their contributions as a reason for not 

contributing. This is a decline from nearly 8 percent in 2006. Similar to the previous 

findings, very few respondents indicate that the TSP is too complex or that they are 

unsure of how to sign up for the plan. However, any confusion about signing up or 

indication of plan complexity is almost exclusively linked to FERS participants. This is 

not surprising given that all CSRS and uniformed service respondents had previously 

signed up to contribute voluntarily to the plan. 
36 

Fig. 17.1 Top Reasons for NOT Participating in the TSP by Retirement System

Why aren’t you currently contributing to the TSP?

 CSRS FERS 

Uniformed 

Services All 

2006 2008 2006 2008 2006 2008 2006 2008 

N= 189 188 309 135 279 326 777 649 

Don't have enough money 25.9% 34.6% 20.1% 24.4% 14.3% 15.6% 19.4% 23.0% 

Saving in other ways 24.3% 29.3% 14.6% 11.9% 24.0% 23.0% 20.3% 22.5% 

Member of Uniformed Services and don't 

get matching contributions n/a 2.1% n/a 0.0% n/a 17.5% n/a 9.4% 

Hardship withdrawal 16.9% 11.7% 7.1% 8.1% 2.5% 1.8% 7.9% 6.0% 

Can't access money before retirement 9.5% 4.8% 3.9% 4.4% 5.0% 6.1% 5.7% 5.4% 

Not satisfied with investment options 4.8% 6.4% 1.9% 3.0% 6.1% 3.7% 4.1% 4.3% 

Not sure how to sign up 0.5% 1.6% 11.0% 13.3% 0.7% 0.0% 4.8% 3.2% 

Too complex 0.5% 1.1% 5.8% 6.7% 2.2% 0.9% 3.2% 2.2% 

Already contributed the maximum 3.2% 0.5% 0.3% 0.0% 6.1% 2.1% 3.1% 1.2% 

Not eligible to contribute 4.2% 0.0% 1.3% 0.7% 2.5% 1.2% 2.5% 0.8% 

New employee and don't get matching 

contributions 0.0% 0.0% 3.6% 1.5% 0.7% 0.0% 1.7% 0.3% 

Notes: Includes active employees who are not currently contributing to the TSP. Participation is based on administrative 

records, since it reflects current contribution decisions, while the survey captures whether the respondent contributed over 

the last two years. 

Fig. 17.2 Top Reasons for NOT Participating in the TSP by Age 

Why aren’t you currently contributing to the TSP?

Age Pay 

Less than Age 

40 40s 

Over Age 

50 

Less than 

$40K 

$40K to 

$80K 

$80K and 

Over 

N= 192 140 307 95 276 265 

Don't have enough money 18.2% 24.3% 25.7% 18.9% 29.3% 17.7% 

Saving in other ways 19.3% 23.6% 24.1% 13.7% 20.7% 28.3% 

Uniformed service member and don't 

get matching contributions 17.2% 12.1% 3.6% 3.2% 8.7% 12.1% 

Hardship withdrawal 3.6% 3.6% 8.1% 4.2% 8.7% 3.4% 

Can't access money before 

retirement 5.2% 4.3% 6.2% 7.4% 4.3% 6.0% 

Not satisfied with investment options 4.7% 1.4% 5.5% 2.1% 3.3% 6.0% 

Not sure how to sign up 2.1% 3.6% 3.9% 13.7% 2.2% 0.8% 

Too complex 1.6% 2.1% 2.6% 5.3% 1.1% 1.9% 

Already contributed the maximum 1.0% 1.4% 1.3% 1.1% 0.4% 1.9% 

Not eligible to contribute 1.0% 0.7% 0.3% 2.1% 0.0% 1.1% 

New employee and don't get 

matching contributions 0.0% 0.7% 0.3% 1.1% 0.0% 0.4% 

Notes: Includes active employees who are not currently contributing to the TSP. Participation is based on administrative 

records, since it reflects current contribution decisions, while the survey captures whether the respondent contributed over 

the last two years. 
37 

Fig. 17.3 Top Reasons for NOT Participating in the TSP by Education 

Why aren’t you currently contributing to the TSP?

High School or 

Less Some College 

College 

Graduate or 

Some Grad 

Graduate 

Degree 

N= 68 189 204 165 

Don't have enough money 27.9% 29.1% 22.5% 14.5% 

Saving in other ways 20.6% 21.2% 23.0% 25.5% 

Uniformed service member and don't get 

matching contributions 2.9% 8.5% 12.3% 10.9% 

Hardship withdrawal 8.8% 8.5% 3.9% 1.8% 

Can't access money before retirement 7.4% 6.3% 3.9% 6.1% 

Not satisfied with investment options 1.5% 4.2% 6.4% 3.6% 

Not sure how to sign up 4.4% 5.3% 2.5% 1.2% 

Too complex 4.4% 2.6% 1.5% 1.8% 

Already contributed the maximum 0.0% 1.1% 1.5% 1.8% 

Not eligible to contribute 0.0% 0.5% 1.0% 1.2% 

New employee and don't get matching 

contributions 1.5% 0.0% 0.5% 0.0% 

Notes: Includes active employees who are not currently contributing to the TSP. Participation is based on administrative 

records, since it reflects current contribution decisions, while the survey captures whether the respondent contributed over 

the last two years. 

Overall, respondents again report tax benefits and the convenience of payroll deductions 

as the top reasons for contributing to the TSP (See Figures 18.1 and 18.2). These 

percentages are significantly lower than in 2006. The percentage indicating tax benefits 

as a reason declined by nearly 14 percentage points compared to 2006 survey respondents, 

while the convenience of payroll deductions dropped by almost 7 percentage points. 

Conversely, respondents to this year’s survey increasingly identified TSP participation as 

important in order for them to retire when they choose. This is particularly the case 

among FERS participants. Matching contributions is the top reason FERS participants 

contribute to the TSP – cited by more than 80 percent of respondents. Survey results 

indicate that word of mouth from co-workers or supervisors is not a major driver of 

employee participation. 
38 

Fig. 18.1 Top Reason for Participating in the TSP by Retirement System 

Whether or not you are contributing to the TSP, which of the following are (or would be) your reasons for contributing to 

the TSP? 

 CSRS FERS 

Uniformed 

Services All 

2006 2008 2006 2008 2006 2008 2006 2008 

N= 1040 778 1266 997 1497 1230 3803 3005 

Tax benefits 75.7% 59.1% 63.4% 55.5% 70.5% 54.2% 69.6% 55.9% 

Convenience of payroll deductions 61.4% 55.3% 55.1% 49.7% 56.0% 48.7% 57.2% 50.7% 

So I can retire when I want to 36.9% 41.8% 41.1% 52.9% 41.4% 47.2% 40.1% 47.7% 

Matching contributions 10.8% 6.2% 85.4% 81.4% 34.1% 20.1% 44.8% 36.8% 

Administrative costs are low 26.3% 21.6% 15.0% 17.8% 26.0% 20.7% 22.5% 20.0% 

Co-worker/friend recommended 6.4% 5.4% 8.5% 7.5% 4.8% 4.7% 6.4% 5.8% 

My supervisor recommended 0.9% 1.2% 3.4% 3.0% 3.5% 4.6% 2.7% 3.2% 

Notes: Includes active employees of the Federal Government. 

Fig. 18.2 Top Reason for Participating in the TSP by Age and Pay 

Whether or not you are contributing to the TSP, which of the following are (or would be) your reasons for 

contributing to the TSP?

Age Pay 

Less than 

Age 40 40s 

Age 50 and 

Over 

Less than 

$40K 

$40K to 

$80K 

$80K and 

Over 

N= 836 730 1416 398 1367 1187 

Tax benefits 44.3% 60.4% 60.8% 30.7% 48.9% 72.6% 

Convenience of payroll deduction 47.1% 47.0% 55.2% 45.0% 51.1% 52.1% 

Matching contributions 57.8% 51.1% 39.8% 48.0% 49.2% 45.7% 

So I can retire when I want to 44.9% 41.0% 30.0% 40.7% 42.6% 28.6% 

Administrative costs are low 17.2% 18.5% 22.6% 13.6% 15.3% 27.6% 

Co-worker recommended 9.0% 4.5% 4.7% 11.3% 7.1% 2.5% 

My supervisor recommended 7.1% 2.2% 1.4% 8.8% 3.4% 1.2% 

Notes: Includes active employees of the Federal Government. 
39 

Savings Rates in the TSP 

In a typical employer-sponsored savings plan like the TSP, employees are the primary 

source of funding and employer contributions play a secondary role. For CSRS and most 

uniformed service participants, however, employee contributions represent the only 

source of savings. As such, the level of participant contributions is a critical determinant 

of whether the plan will generate an adequate level of savings for retirement. 

 

TSP survey respondents indicate saving on average 10.3 percent of their income (see 

Figures 19.1 to 19.3). The median participant contribution rate is 10.0 percent, meaning 

that half of participants are saving above this rate and half are saving below it.6 Savings 

rates in 2008 are consistent with those reported from the prior survey. These contribution 

rates are over three percentage points higher than typical private sector savings plan 

contributions of 7 to 8 percent.7 This finding can be partly explained by the 

comparatively older workforce within the Federal Government. However, even after 

controlling for age and pay, TSP savings rates are still higher than those observed in 

the private sector. However, it should be noted that savings rates represented by this 

survey are self-reported and exclude eligible employees who are not currently 

contributing to the TSP. 

Average savings rates among FERS and CSRS participants are no different at 9.2%, 

although, there is a one percentage point difference between median saving rates (8.0% 

vs. 9.0%). It is important to note that nearly a third of FERS participants are contributing 

at the 5 percent of pay threshold, which is the rate at which FERS participants receive the 

maximum matching contributions. Similar to 2006, the survey found that the highest 

savings rates belong to participants of the uniformed services, who report savings rates 

almost 3 percentage points above FERS and CSRS participants and almost 5 percentage 

 

6

 These rates include additional catch-up contributions for employees age 50 and over. Participants who 

reach age 50 before the calendar year is over are permitted to make additional catch-up contribution on a 

pre-tax basis. In 2008, catch-up contributions limits were $5,000. 

7

 Vanguard, 2007. How America Saves 2007, A Report on Vanguard 2006 Defined Contribution Plan Data. 

www.vanguardretirementresearch.com. 
40 

points above the average participant in the private sector. However, the median rate is 

equal to the overall Federal employee rate of 10 percent, indicating that a 

disproportionate share of uniformed service members is contributing a very high 

percentage of their pay to the TSP. In fact, nearly 15 percent of members of the 

uniformed services indicate contributing 15 percent of pay or higher to the TSP 

compared to 6.2 percent of FERS participants and 6.3 percent of CSRS 

participants.8,9 

Fig. 19.1a TSP Average Participant Contribution Rates by Retirement System and Gender

What percentage of your pay are you currently contributing to the TSP?

CSRS FERS Uniformed Services All 

 2006 2008 2006 2008 2006 2008 2006 2008 

Male 9.5% 9.3% 9.1% 9.4% 11.9% 11.7% 10.5% 10.5% 

Female 8.7% 9% 8.8% 8.9% 11.6% 12.25 9.4% 9.7% 

All 9.1% 9.2% 9% 9.2% 11.9% 11.8% 10.2% 10.3% 

Notes: Includes active employees of the Federal Government, who are currently contributing a portion of pay to the TSP, 

N=2,555 in 2008 and N=2,958 in 2006. 

Fig. 19.1b TSP Average and Median Participant Contribution Rates by Retirement System 

and Gender

What percentage of your pay are you currently contributing to the TSP?

CSRS FERS Uniformed Services All 

Average Median Average Median Average Median Average Median 

Male 9.3% 10.0% 9.4% 8.0% 11.7% 10.0% 10.5% 10.0% 

Female 9.0% 8.5% 8.9% 7.6% 12.2 10.0% 9.7% 9.5% 

All 9.2% 9.0% 9.2% 8.0% 11.8 10.0% 10.3% 10.0% 

Notes: Includes active employees of the Federal Government, who are currently contributing a portion of pay to the TSP, 

N=2,555. 

 

8 In part, this can be attributed to the fact that members of the Uniformed Services may receive tax-exempt 

contributions which are not limited by IRS rules 402(g). Uniformed services participants may elect to 

contribute basic pay, incentive pay, or special pay (including bonus pay) to the TSP. They must contribute 

basic pay to be eligible to contribute incentive pay or special pay (including bonus pay). Contributions 

from all sources of pay are subject to the 402(g) limit, which restricted pre-tax contributions to $15,500 in 

2008. However, if any source of pay is received while the participant is in a combat zone or qualified 

hazardous duty area, it is received tax-exempt and the 402(g) limit no longer applies. Tax-exempt pay is 

only subject to the 415(c) limit. FERS and CSRS participants may only contribute from their basic pay, 

subject to the 402(g). 

9

 Numbers not provided in the tables of the report. 
41 

Fig. 19.2a TSP Average Estimated Participant Contribution Amount by Retirement System, 

Gender and Survey Year

What percentage of your pay are you currently contributing to the TSP?

CSRS FERS Uniformed Services All 

2006 2008 2006 2008 2006 2008 2006 2008 

Male $8,558 $8,618 $6,271 $6,846 $9,019 $9,029 $8,084 $8,291 

Female $6,629 $7,631 $5,223 $6,107 $7,078 $8,012 $6,144 $7,017 

All $7,869 $8,216 $5,824 $6,539 $8,612 $8,824 $7,413 $7,867 

Notes: Includes active employees of the Federal Government, who are currently contributing a portion of pay to the TSP, 

N=2,555 in 2008 and N=2,958 in 2006. Contribution amounts were derived using respondent’s self-reported contribution 

rates at the time of the survey times the mid-point of their annual pay group. Dollar amounts could over- or underestimate annual contributions, since actual deferral percentages can fluctuate throughout the year and given that annual 

pay is estimated based on participant’s response to the survey. 

Fig. 19.2b TSP Average and Median Estimated Participant Contribution Amount by 

Retirement System and Gender

What percentage of your pay are you currently contributing to the TSP?

CSRS FERS Uniformed Services All 

Average Median Average Median Average Median Average Median 

Male $8,618 $7,000 $6,846 $5,000 $9,029 $7,000 $8,291 $6,250 

Female $7,631 $6,250 $6,107 $4,550 $8,012 $4,500 $7,017 $5,000 

All $8,216 $6,500 $6,539 $5,000 $8,824 $6,300 $7,867 $6,000 

Notes: Includes active employees of the Federal Government, who are currently contributing a portion of pay to the TSP, 

N=2,555. Contribution amounts were derived using respondent’s self-reported contribution rates at the time of the survey 

times the mid-point of their annual pay group. Dollar amounts could over- or under-estimate annual contributions, since 

actual deferral percentages can fluctuate throughout the year and given that annual pay is estimated based on 

participant’s response to the survey. 

Fig. 19.3 TSP Average Participant Contribution Rates by Age, Pay and Tenure

What percentage of your pay are you currently contributing to the TSP?

Age Pay 

Tenure (Years)

Less than 

Age 40 40s 

Age 50 and 

Over 

Less than 

$40K 

$40K to 

$80K 

$80K and 

Over All 

Less than 2 7.9% 7.4% 9.2% 7.7% 7.6% 10.3% 8.2% 

2 to 5 9.8% 8.3% 8.4% 9.6% 9.0% 9.7% 9.2% 

5 to 15 9.9% 10.7% 11.0% 10.6% 9.6% 11.6% 10.3% 

15+ 10.4% 10.4% 10.8% 11.6% 10.2% 11.1% 10.7% 

All 9.6% 10.1% 10.7% 10.0% 9.6% 11.0% 10.3% 

Notes: Includes active employees of the Federal Government, who are currently contributing a portion of pay to the TSP, 

N=2,555. 
42 

Sources of Retirement Income 

Retirees typically depend on multiple sources of income during retirement. TSP 

participants were asked to rank their top three expected sources of retirement income. In 

general, respondents consider each “leg of the stool” – Social Security, employersponsored retirement program and personal savings – to be important to their retirement 

security. However, they believe their Federal Government-sponsored retirement plans to 

be the most important (See Figures 20.1 to 20.3). 

FERS participants underline many different sources of retirement income (See Figure 

20.1). However, the TSP is mentioned by nearly one in four FERS participants as being 

the primary income source in retirement. In fact, more than two-thirds of FERS 

participants identify the TSP account as a “Top-3” important retirement resource, which 

is twice as high as the ranking given to the FERS annuity plan. FERS participants also 

view Social Security as a critical source of future retirement income. 

“TSP is useful as a saving/investment vehicle. However, in the short-term, I am glad that it 

is not my only source of retirement income.”

Fig. 20.1 Most Important Sources of Future Retirement Income for FERS Participants 

Rank your TOP 3 most important expected sources of retirement income. 

Ranking of Sources % Mentioned 

1st 2nd 3rd 2006 2008 

TSP account 23.1% 24.9% 20.7% 67.1% 68.7% 

Social Security 14.3% 23.3% 24.3% 62.9% 61.9% 

Income from work 13.2% 5.1% 5.3% 23.6% 23.5% 

Military pension 11.8% 3.7% 1.9% 18.2% 17.5% 

FERS/CSRS annuity 11.1% 11.6% 10.1% 33.6% 32.9% 

Personal savings (e.g. IRA) 7.6% 10.8% 12.8% 35.4% 31.2% 

Other retirement plan (non-gov't) 6.7% 5.9% 5.3% 19.8% 17.8% 

Home Equity 3.0% 3.9% 7.1% 16.1% 14.1% 

Income from spouse's work 2.8% 4.4% 3.8% n/a 11.0% 

Survivor annuity 0.5% 0.5% 0.9% n/a 1.8% 

Notes: Based on FERS respondents, N=1,292. 

It is not at all surprising that CSRS and uniformed services participants identify their 

respective annuity-based pensions most often as a critical source of future retirement 

income (See Figures 20.1 & 20.2). The CSRS annuity plan is mentioned by more than 
43 

two-thirds of CSRS participants as the most important source of future retirement income 

and in total, it is mentioned by more than three quarters as being among the top three 

sources. While nearly as many uniformed service members identify their military 

pension as critical (75 percent), only 43 percent highlight it as their top choice. Both 

CSRS participants and those in the uniformed services identify the TSP as a very 

important supplementary source of future income. Compared to other sources of 

retirement income, it is the second most mentioned income source for CSRS participants 

and third most for uniformed service members. 

Fig. 20.2 Most Important Sources of Future Retirement Income for CSRS Participants 

Rank your TOP 3 most important expected sources of retirement income. 

Ranking of Sources % Mentioned 

1st 2nd 3rd 2006 2008 

FERS/CSRS annuity 69.0% 4.5% 2.9% 77.8% 76.4% 

Income from work 14.6% 4.7% 4.5% 22.8% 23.8% 

Home Equity 2.4% 3.7% 7.1% 16.3% 13.3% 

Personal savings (e.g. IRA) 2.0% 16.5% 22.5% 41.5% 41.0% 

Other retirement plan (non-gov't) 1.8% 3.1% 4.5% 9.4% 9.4% 

Military pension 1.2% 3.7% 1.0% 5.7% 5.9% 

Social Security 1.1% 11.2% 10.9% 23.0% 23.2% 

Income from spouse's work 0.9% 8.7% 4.5% n/a 14.1% 

TSP account 0.7% 33.8% 27.8% 69.8% 62.3% 

Survivor annuity 0.2% 1.1% 1.6% n/a 2.9% 

Notes: Based on CSRS respondents, N=1,389. 

Fig. 20.3 Most Important Sources of Future Retirement Income for Uniformed Service 

Members 

Rank your TOP 3 most important expected sources of retirement income. 

Ranking of Sources % Mentioned 

1st 2nd 3rd 2006 2008 

Military pension 43.3% 19.8% 11.7% 73.8% 74.7% 

Other retirement plan (non-gov't) 12.8% 9.9% 6.3% 31.3% 29.0% 

Income from work 12.5% 7.1% 6.0% 22.4% 25.6% 

Personal savings (e.g. IRA) 9.2% 18.4% 14.8% 46.4% 42.4% 

TSP account 5.7% 14.2% 22.1% 47.4% 42.0% 

FERS/CSRS annuity 5.4% 4.1% 2.2% 11.5% 11.6% 

Social Security 3.0% 14.6% 23.8% 39.0% 41.4% 

Home Equity 2.0% 2.7% 4.8% 10.4% 9.5% 

Income from spouse's work 1.7% 3.8% 2.5% - 8.0% 

Survivor annuity 0.1% 0.2% 0.5% - 0.8% 

Notes: Based on Uniformed Service respondents, 2,210. 

When combined into a single table, the relative importance of annuity plans and the TSP 

as a future source of retirement income to Federal employees and uniformed service 
44 

members becomes even more apparent (See Figure 19). It is clear that Federal 

employees and service members heavily rely on the Federal Government’s retirement 

program for a secure retirement. While not mentioned as often, personal savings and 

Social Security are also viewed as critical to a secure retirement. Finally, nearly one 

quarter of all Federal employees and uniformed service members expect to receive 

retirement income from work. This is consistent across respondents from the different 

retirement systems. Additionally, income from work did not change significantly from 

the 2006 survey, despite the current economic climate. 

Fig. 21 Sources of Future Retirement Income Mentioned as Top 3 Most Important by 

Retirement System

Rank your TOP 3 most important expected sources of retirement income.

CSRS FERS 

Uniformed 

Services All 

TSP account 62.3% 68.7% 42.0% 54.8% 

Social Security 23.2% 61.9% 41.4% 41.6% 

Military pension 5.9% 17.5% 74.7% 40.1% 

Personal savings (e.g. IRA) 41.0% 31.2% 42.4% 39.1% 

FERS/CSRS annuity 76.4% 32.9% 11.6% 35.6% 

Income from work 23.8% 23.5% 25.6% 24.6% 

Other retirement plan (non-gov't) 9.4% 17.8% 29.0% 20.4% 

Home Equity 13.3% 14.1% 9.5% 11.8% 

Income from spouse's work 14.1% 11.0% 8.0% 10.5% 

Survivor annuity 2.9% 1.8% 0.8% 1.7% 

Notes: Based on all respondents, N=4,891. 

As shown above, personal savings is highly mentioned by Federal employees and 

uniformed services members as being important sources of retirement income. When 

asked about the types of accounts used to accumulate savings for retirement (other than 

their TSP account or annuity/pension plan), more than two in five mentioned owning 

stocks, mutual funds, or a brokerage account. More than a third of participants have an 

IRA – split evenly between a traditional and a Roth IRA – although CSRS participants 

are more inclined to have a traditional IRA, whereas uniformed services members are 

more likely to have a Roth IRA. This is likely an indication that CSRS tend to be older 

and be in a higher tax bracket than the younger members of the uniformed services. Of 

the respondents, about one in five Federal employees and uniformed service members 

have no other account. Not surprising, those that have an account other than the TSP is 

highly linked to older, higher paid employees with larger TSP account balances. 
45 

Fig. 22.1 Accounts Used to Save for Retirement by Retirement System

If you have set aside money specifically for retirement, indicate the type of accounts where you have retirement savings.

CSRS FERS 

Uniformed 

Services All 

Mutual funds, stocks, bonds or brokerage 

accounts 40.7% 30.0% 49.0% 41.6% 

Traditional IRA 37.4% 29.5% 39.7% 36.4% 

Roth IRA 25.5% 25.2% 48.7% 35.9% 

Bank/credit union account 35.8% 23.2% 27.5% 28.7% 

Other employer's tax-deferred account 6.6% 16.8% 32.2% 20.8% 

I have no other accounts 22.3% 28.9% 13.9% 20.3% 

Other 11.8% 9.0% 10.0% 10.2% 

Other employer's Roth 401(k) 1.1% 2.1% 4.6% 2.9% 

Notes: Based on all respondents, N=4,891. 

Fig. 22.2 Accounts Used to Save for Retirement by Age and Pay

If you have set aside money specifically for retirement, indicate the type of accounts where you have retirement savings.

Age Pay 

Less than 

Age 40 40s 

Age 50 

and Over 

Less 

than 

$40K 

$40K to 

$80K 

$80K and 

Over All 

Mutual funds, stocks, bonds or 

brokerage accounts 34.9% 42.9% 44.3% 27.8% 35.3% 55.0% 41.6% 

Traditional IRA 18.6% 35.6% 44.5% 26.1% 28.1% 49.7% 36.4% 

Roth IRA 41.8% 41.7% 31.1% 26.6% 32.0% 45.3% 35.9% 

Bank/credit union account 21.6% 25.2% 33.6% 26.6% 27.7% 30.8% 28.7% 

Other employer's tax-deferred 

account 24.4% 27.9% 16.3% 14.8% 17.7% 27.5% 20.8% 

I have no other accounts 24.2% 19.9% 18.8% 28.3% 24.2% 12.6% 20.3% 

Other 5.8% 9.8% 12.3% 10.2% 8.9% 11.9% 10.2% 

Other employer's Roth 401(k) 4.2% 3.8% 2.0% 1.9% 3.1% 3.4% 2.9% 

Notes: Based on all respondents, N=4,891. 

Fig. 22.3 Accounts Used to Save for Retirement by TSP Account Balance

If you have set aside money specifically for retirement, indicate the type of accounts where you have retirement savings.

TSP Account Balance 

Less than 

$5K 

$5K to 

$25K 

$25K to 

$50K 

$50K to 

$100K 

$100K and 

Over All 

Mutual funds, stocks, bonds or brokerage 

accounts 30.9% 41.7% 43.9% 47.0% 53.4% 41.6% 

Traditional IRA 26.1% 36.9% 36.4% 39.8% 51.6% 36.4% 

Roth IRA 28.6% 40.1% 37.2% 37.0% 37.5% 35.9% 

Bank/credit union account 21.6% 26.1% 33.0% 34.3% 36.7% 28.7% 

Other employer's tax-deferred account 28.6% 27.7% 16.5% 9.8% 8.4% 20.8% 

I have no other accounts 25.3% 19.3% 20.2% 18.1% 15.2% 20.3% 

Other 9.5% 10.5% 10.4% 9.7% 11.7% 10.2% 

Other employer's Roth 401(k) 3.5% 4.4% 2.8% 1.0% 1.2% 2.9% 

Notes: Account balance is based on administrative records for all respondents, N=4,891.
46 

Retirement Goals and Expectations 

Financial planners often recommend that employees strive for retirement income of at 

least 70 percent of their pre-retirement earnings. Many respondents report expectations 

that align very closely with this conventional wisdom. In fact, over one third of survey 

participants believe they will need more than 80 percent of their annual income in order 

to live comfortably in retirement (See Figure 23.1 and 23.2). This belief tends to be 

consistent across the three retirement systems. 

Fig. 23.1 Percentage of Pre-Retirement Income Required to Live Comfortably in Retirement 

by Retirement System

Approximately what percentage of your annual pre-retirement pay do you think you need to live comfortably when you 

retire? 

CSRS FERS 

Uniformed 

Services 2006 2008 

Less than 40% 3.6% 4.4% 3.3% 1.9% 3.7% 

40 to 59% 13.0% 16.15 14.4% 15.4% 14.4% 

60 to 79% 40.4% 30.8% 36.7% 36.4% 36.2% 

80 to 99% 23.0% 20.2% 24.8% 22.4% 23.1% 

100%+ 10.3% 14.7% 12.6% 13.4% 12.5% 

Don’t Know 9.7% 13.75 8.3% 10.5% 10.1% 

Notes: Based on all respondents, N=4,891. 

Fig. 23.2 Percentage of Pre-Retirement Income Required to Live Comfortably in Retirement 

by Age and Pay 

Approximately what percentage of your annual pre-retirement pay do you think you need to live comfortably when you 

retire? 

Age Pay 

Less than 

Age 40 40s 

Age 50 and 

Over 

Less than 

$40K 

$40K to 

$80K 

$80K and 

Over All 

Less than 40% 2.2% 3.2% 4.5% 5.2% 3.8% 3.1% 3.7% 

40 to 59% 12.8% 13.7% 15.5% 16.2% 14.6% 13.0% 14.4% 

60 to 79% 30.1% 39.1% 37.6% 21.4% 36.4% 43.0% 36.2% 

80 to 99% 22.5% 22.9% 23.7% 15.8% 21.2% 29.2% 23.1% 

100%+ 18.2% 12.9% 9.9% 19.9% 14.2% 7.7% 12.5% 

Don’t Know 14.3% 8.1% 8.9% 21.6% 10.0% 4.1% 10.1% 

Notes: Based on all respondents, N=4,891. 

Some, however, may be underestimating their income needs in retirement. Overall, about 

18 percent believe they can retire comfortably on less than 60 percent of their preretirement annual income. Of greater concern, 10 percent of respondents cannot estimate 

how much income they will need in retirement. Taken together, more than a quarter of all 
47 

surveyed participants either believe they will need less income than what financial 

planners generally recommend or are unable to estimate their income needs. This is 

particularly a concern among participants age 50 and over, where nearly 29 percent fall 

into this group. 

One question that remains hotly debated by academics and practitioners is whether the 70 

percent pre-retirement income target will be sufficient given the imminent costs that will 

be borne by the America’s retirement system as the Baby Boom Generation begins 

retiring. Results from EBRI’s 2006 Retirement Confidence Survey show that over 50 

percent of retirees believe they needed about the same or more than their pre-retirement 

income, which is significantly higher than current expectations of the Federal workforce 

and the uniformed services as reflected by the survey respondents.10 It is very important 

for employees to set realistic expectations about their retirement income needs so they are 

not overly complacent about saving for retirement throughout their career. 

For employees born in 1960 or later, normal retirement age under Social Security is 67. 

However, many Federal employees and members of the uniformed services plan to retire 

much sooner. Twenty-seven percent of TSP participants anticipate retiring by age 60 and 

another 32 percent plan to retire before age 65 (See Figure 24.1 and 24.2). Roughly a 

third of CSRS participants plan to enter full retirement in their fifties compared to one in 

five (20 percent) FERS participants. This means that the average CSRS participant 

anticipates a retirement period of more than 20 years; a significant share of CSRS 

participants, in fact, expect a retirement period approaching 25 years. It is important to 

note that CSRS participants are not covered under the Social Security program. Overall, 

expectations of the Federal workforce and the uniformed services about the length of 

retirement are longer than other employees. Results from EBRI’s 2008 Retirement 

 

10 See Ruth Helman, Mathew Greenwald & Associates, Craig Copeland, and Jack VanDerhei, 2006. “Will 

More of Us Be Working Forever? The 2006 Retirement Confidence Survey,” EBRI Issue Brief No. 292, 

April. 
48 

Confidence Survey show that over 60 percent of employees plan to retire at age 65 and 

older. In fact, more than a third of employees plan to work past age 66 or never retire.11 

Fig. 24.1 Planned Retirement Age 

At what age do you plan to retire from all full-time employment? 

TSP Survey 

CSRS FERS 

Uniformed 

Services 2006 2008 

Younger than 55 1.9% 3.6% 6.0% 5.8% 4.4% 

55 to 59 31.1% 16.4% 22.1% 28.1% 22.7% 

60 to 61 12.8% 12.0% 13.3% 13.6% 12.9% 

62 to 64 22.6% 20.2% 17.5% 17.0% 19.4% 

65 9.1% 13.4% 16.9% 13.0% 14.1% 

66 or older 20.9% 32.2% 21.3% 22.5% 24.1% 

Never Retire 1.6% 2.2% 2.9% - 2.4% 

Notes: Excludes respondents who self-report as being already retired or Don’t Know, N=3,818. 

Fig. 24.2 Planned Retirement Age by age and Pay 

At what age do you plan to retire from all full-time employment? 

Age Pay 

Less than 

Age 40 40s 

Age 50 and 

Over 

Less than 

$40K 

$40K to 

$80K 

$80K and 

Over All 

Younger than 55 9.8% 4.8% 1.3% 6.8% 4.0% 3.9% 4.4% 

55 to 59 28.4% 28.3% 16.9% 17.3% 23.8% 23.4% 22.7% 

60 to 61 16.9% 11.9% 11.6% 10.9% 14.5% 12.0% 12.9% 

62 to 64 11.7% 17.6% 24.5% 16.2% 20.4% 19.8% 19.4% 

65 14.7% 15.5% 12.7% 15.0% 13.4% 14.3% 14.1% 

66 or older 16.1% 19.9% 30.5% 28.8% 21.8% 24.7% 24.1% 

Never Retire 2.5% 2.0% 2.6% 5.1% 2.0% 2.0% 2.4% 

Notes: Excludes respondents who self-report as being already retired or Don’t Know, N=3,818. 

For those who plan to retire younger – before age 60 – it appears the TSP account 

balance has a strong influence in shaping their expectations. For respondents in their 

forties, nearly half of respondents with a TSP account balance over $50,000 plan to retire 

before age 60, while only about a quarter of those with smaller account balances (under 

$25,000) see themselves exiting the workforce at that age (See Figure 25.1 and 25.2). 

Many respondents with low TSP account balances anticipate retiring much later. 

 

11 See Ruth Helman, Mathew Greenwald & Associates, Craig Copeland, and Jack VanDerhei, 2008. 

“Americans Much More Worried About Retirement, Health Costs a Big Concern? The 2008 Retirement 

Confidence Survey,” EBRI Issue Brief No. 316, April. 
49 

Fig. 25.1 Planned Retirement Age for Employees in their Forties 

TSP Account Balance 

Less than $5K 

$5K to 

$25K $25K to $50K 

$50K to 

$100K 

$100K and 

Over 

Before 60 26.7 26.4 36.4 45.8 54.1 

Between 60 & 65 28.7 31.4 29.3 26.4 29.7 

65 and Older 44.6 42.2 34.3 27.8 16.2 

Notes: Excludes respondents who self-report as being already retired or Don’t Know, N=1,027. 

Fig. 25.2 Planned Retirement Age for Employees in their Fifties 

TSP Account Balance 

Less than $5K 

$5K to 

$25K $25K to $50K 

$50K to 

$100K 

$100K and 

Over 

Before 60 21.7 21.3 35.1 38.3 37.3 

Between 60 & 65 32.5 40.5 35.6 37.9 45.1 

65 and Older 45.9 38.2 29.3 23.8 17.7 

Notes: Excludes respondents who self-report as being already retired or Don’t Know, N=1,073. 

Working during retirement is a growing trend in the U.S. labor market. With the aging of 

the workforce and the potential for skills shortages with the retiring of the Baby Boom 

Generation, older employees have become more valuable to U.S. companies. In fact, 

America’s largest corporations have developed formal programs such as phased 

retirement and flexible work arrangements – to appeal to an aging workforce and 

encourage longer working lives. 

Federal employees and members of the uniformed services indicate a somewhat modest 

appetite for working after retiring from the Federal Government. Less than one third of 

respondents indicate a strong interest in working following retirement while another third 

indicate they are somewhat likely to work post-retirement. The final one third is 

indifferent or indicates that they were unlikely to work after retiring from the Federal 

Government. 
50 

Fig. 26.1 Likelihood to Work after Retiring from the Federal Government by Retirement 

System 

Assume you continue to work for the Federal Government until you can retire. What is the likelihood that you will work for 

pay after you retire? 

CSRS FERS 

Uniformed 

Services All 

Very Likely to Work 27.7% 25.1% 36.1% 30.3% 

Somewhat Likely to Work 29.6% 36.7% 38.8% 35.7% 

Less Likely to Work 42.7% 38.2% 25.1% 34.0% 

Notes: Includes Actives, N=3,372. Very Likely to Work includes those who respond “Very Likely” to work (1 out of 5) after 

retiring for the Federal Government. Somewhat Likely to Work includes those who respond “Somewhat Likely” to work (2 

out of 5). Less Likely to Work includes those who respond “Neither Likely Nor Unlikely”, “Somewhat Unlikely” or “Very 

Unlikely” to work (3, 4, or 5 out of 5). 

For Federal employees nearing retirement, expectations about working after retirement 

appear to be influenced by the amount of funds in their TSP accounts. However, this is 

not the case for participants who are over a decade away from retirement (see Figure 

26.1). On average, participants who are less likely to work after retiring have nearly 

$20,000 more in their TSP accounts than those who indicate a strong likelihood of 

working later in life. This finding may reflect both the need to work for financial reasons, 

as well as a desire to remain active. The difference in the average TSP account balances 

is likely not sufficient to make a significant difference in filling the income needs in 

retirement. It is unclear whether those with higher TSP account balances also have 

higher savings elsewhere. 

Fig. 26.2 TSP Account Balances and Likelihood to Work after Retiring from the Federal 

Government by Age 

Assume you continue to work for the Federal Government until you can retire. What is the likelihood that you will work for 

pay after you retire? 

 Age Group 

Percent 

Responding <40 40s 50+ All 

Very Likely to Work 30.3% $11,557 $42,507 $49,605 $37,570 

Somewhat Likely to Work 35.7% $9,713 $38,801 $60,655 $38,374 

Less Likely to Work 34.0% $13,369 $40,951 $72,659 $51,177 

All $11,257 $39,756 $61,973 $42,495 

Notes: Includes Actives, N=3,372. Very Likely to Work includes those who respond “Very Likely” to work (1 out of 5) after 

retiring for the Federal Government. Somewhat Likely to Work includes those who respond “Somewhat Likely” to work (2 

out of 5). Less Likely to Work includes those who respond “Neither Likely Nor Unlikely”, “Somewhat Unlikely” or “Very 

Unlikely” to work (3, 4, or 5 out of 5). 
51 

Part C: Potential Changes to the TSP 

The FRTIB is considering changes to the TSP to help participants better prepare for 

retirement. In Section C of the survey we asked participants to respond to possible 

enhancements to TSP services that are under consideration based on their general 

assessment of whether these changes would help TSP participants. Most questions in this 

section included a “don’t know” response as an option for participants were unfamiliar 

with the changes proposed. The TSP is considering adding a Roth 401(k) option, either 

with or without making professional tax advice available and providing a self-directed 

mutual fund window option. Survey participants were also asked what actions they 

believed would lead to greater participation in the TSP. 

Adding a Roth 401(k) Option 

A majority of respondents favor adding an option to contribute to a Roth 401(k) account 

to the TSP program while very few respondents indicate the addition would not be an 

enhancement (56 percent favorable to 10 percent unfavorable). The strongest support for 

adding this option is among the uniformed services participants. 

The primary advantage of a traditional 401(k) account is to allow participants to make 

pre-tax contributions during working years when income and tax rates are typically 

higher and to defer taxes until retirement years when expected income and tax rates will 

typically be lower. The Roth 401(k) feature requires making after-tax contributions but 

provides future tax advantages through tax-free growth and distributions. For many 

participants in the uniformed services, current income and tax rates may be as low as or 

lower than their expected future tax rates. For someone in this position, the advantage of 

the Roth 401(k) is substantial. In the civilian sector, the support for adding the Roth 

401(k) is weaker (52 percent in the FERS and 48 percent in the CSRS). While there is 

not much opposition to the possibility of adding a Roth 401(k) feature (only 10 percent of 

respondents), 17 percent of all respondents said they don’t know whether the Roth 401(k) 
52 

feature would make the TSP better. Comparing these to responses in the 2006-07 survey, 

we see a 4 percentage point decline in the percentage of those people who think the TSP 

would be a better program if it added the Roth 401(k) option and a corresponding 5 

percentage point increase in the proportion who said they didn’t know. 

Fig. 27 Roth 401(k) Support by Retirement System 

The TSP would be a better program if it provided an option to contribute to a Roth 401(k) 

Retirement System Agree Neutral Disagree Don’t Know 

CSRS 48% 17% 11% 24% 

FERS 52% 20% 11% 17% 

Uniformed Services 63% 17% 8% 12% 

All – 2006 60% 16% 11% 12% 

All– 2008 56% 18% 10% 17% 

There is a significant difference between saying that adding a service or investment 

option would make the program better then actually using it or being willing to pay for it. 

These differences are illustrated by Figure 29 below. While 56 percent of all 

respondents agreed the TSP would be a better program if it added the Roth 401(k) option, 

only 42 percent of respondents said they would contribute some or all of their 

contributions to one, compared to 18 percent who indicated they would not. 

Fig. 28 Potential Contributions to Roth 401(k) by Retirement System 

I would contribute some or all of my contributions to a Roth 401(k). 

Retirement System Agree Neutral Disagree Don’t Know 

CSRS 32% 16% 21% 32% 

FERS 40% 19% 18% 23% 

Uniformed Services 49% 19% 16% 16% 

All 42% 18% 18% 23% 

There is an apparent disconnect between respondents’ preference for adding a Roth 

401(k) feature to the TSP and their actual usage of existing Roth account benefits. Roth 

IRA’s have been in existence since 1997. A participant in the TSP, or any similar 
53 

qualified retirement plan, may make Roth IRA contributions as long as their adjusted 

gross income (AGI) is below certain limits. The tax benefits offered through a Roth 

401(k) account within the TSP would be substantially the same as those offered by the 

Roth IRA, except that there would not be an income limit. While 56 percent of 

respondents prefer adding a Roth 401(k) account to the TSP, only 36 percent have 

established a Roth IRA account. This differential may be partially explained by the 

income limitation imposed on the Roth IRA, but this is probably not the case for most 

participants. 

To examine this issue, respondents were asked how they believed their current tax rate 

compared to their expected tax rate after they retire. Respondents were almost twice as 

likely to say they expected their tax rate to be lower at retirement than it is today than 

they were to say they expected it to be higher (39% vs. 20%). For these people, there is 

little or no tax advantage from a Roth 401(k) option. 

Fig. 29 Expected Tax Rate in Retirement 

What level do you expect your tax rate to be after you retire in comparison to your tax rate today? 

Response % of respondents 

Higher than today 20% 

Stay the same as today 19% 

Lower than today 39% 

I am already retired 9% 

Don’t Know 13% 

It is interesting to review the attitudes towards the Roth 401(k) feature based on 

respondents’ belief about their own tax rates. Sixty-three percent of respondents who 

expect their tax rate to be higher in retirement than it is today agree that the TSP would 

be a better program if it provided the Roth 401(k) option, compared to only 7 percent 

who disagreed. These participants could benefit substantially from such a change if their 

current income is too high to set up a Roth IRA. However, there is very little drop-off in 

the favorability among active employees who think their tax rate will stay the same or 

decline. The numbers are significantly lower amongst those who say they are already 

retired and those who do not know what their tax rate will be. 
54 

Fig. 30 Roth 401(k) Support by Expected Tax Rate in Retirement 

The TSP would be a better program if it provided an option to contribute to a Roth 401(k) – 2008 Survey

What level do you expect your tax rate to be after 

you retire in comparison to your tax rate today? Agree Neutral Disagree Don’t Know 

Higher than today 63% 17% 7% 12% 

Stay the same as today 61% 17% 10% 12% 

Lower than today 56% 19% 12% 13% 

Don’t Know 44% 19% 8% 30% 

All 56% 18% 10% 17% 

Of course, many people may support a change that will significantly benefit some of TSP 

participants even if they do not expect to benefit directly. Here we find that 54 percent of 

respondents who expect their tax rate in retirement to be above their current rate say they 

would take advantage of the tax benefits and make a contribution to a Roth 401(k) feature 

if it was available. This number declines to 44 percent for those who expect their tax rate 

to remain the same. For respondents who say they expect their tax rate when they retire 

to be lower than their current rate, there is a tax disadvantage to making contributions 

into a Roth 401(k) feature. Nevertheless, 43 percent of those respondents agreed they 

would contribute some of all of their contributions to a Roth 401(k) feature if it were 

available. This response is most likely attributable to their lack of complete knowledge 

of the tax disincentives for making that contribution. In addition, there may be confusion 

between the perceived advantages of the Roth 401(k) feature and other tax advantaged 

retirement accounts such as a 401(k). This suggests that if the TSP adds a Roth 401(k) 

option, it should consider providing professional tax advisory services to help 

participants understand the tax implications of their investment decisions. 

“Keep it simple. Investing is hard for a lot of people to understand. By limiting options 

and providing the L - funds, TSP is simple. Adding a Roth 401K could probably benefit 

some folks, just not me right now.”
55 

Fig. 31 Potential Contributions to Roth 401(k) by Expected Tax Rate in Retirement 

14. What level do you expect your tax rate to be after you retire in comparison to your tax rate today? 

I would contribute some or all of my contributions to a Roth 401(k).

What level do you expect your tax rate to be after 

you retire in comparison to your tax rate today? Agree Neutral Disagree Don’t Know 

Higher than today 54% 20% 11% 16% 

Stay the same as today 44% 18% 19% 19% 

Lower than today 43% 18% 22% 18% 

I am already retired 17% 16% 18% 49% 

Don’t Know 35% 19% 13% 33% 

All 42% 18% 18% 23% 

Some participants may be reluctant or unsure about contributing to a Roth 401(k) without 

professional advice on the tax implications of such an investment. Respondents 

recognize their need for professional tax advice as part of this decision-making process. 

Roughly half of all respondents indicated they would need professional advice before 

determining what contribution to make to a Roth 401(k), if any. This holds true in every 

retirement system. 

Fig. 32 Necessity of Professional Tax Advice to Evaluate a Roth 401(k) Option 

I would need professional tax advice before determining what, if any, amount I should direct to a Roth 401(k) option.

Retirement System Agree Neutral Disagree Don't Know 

CSRS 48% 17% 16% 19% 

FERS 55% 17% 15% 13% 

Uniformed Services 51% 21% 21% 8% 

All 51% 19% 18% 12% 

Another change under consideration would be making professional tax advice available 

at an additional cost. Thirty-five percent of respondents agreed that they would want the 

TSP to provide this service, compared to 30 percent who disagreed and an additional 13 

percent who did not know. While there does not appear to be overwhelming support for 

adding tax advice services at this time, adding this as an optional service would address 

potential confusion that TSP participants may have about the different tax implications of 

the Roth 401(k) feature, compared to their current TSP account. 
56 

Fig. 33 Professional Tax Advice Availability 

 If professional tax advice could be made available (at an additional cost), I would want the TSP to provide this service

Retirement System Agree Neutral Disagree Don't Know 

CSRS 32% 21% 28% 19% 

FERS 38% 22% 27% 14% 

Uniformed Services 34% 25% 32% 9% 

All 35% 23% 30% 13% 

Self-Directed Mutual Funds 

The TSP is also considering adding a self-directed mutual fund window. The new 

account option would be offered through a brokerage firm and allow participants to select 

from hundreds of publicly-traded mutual funds in addition to the TSP’s core investment 

options. Participants who elected to use this window would be subject to additional fees. 

In the 2006 TSP survey, 46 percent of respondents indicated the TSP would be a better 

system if it provided additional investment options. This support ranged from 36 percent 

in the CSRS system to 51 percent of respondents in the uniformed services. 

Fig. 34 Support for adding investment options by Retirement System – 2006 Survey.

The TSP would be a better program if it offered a wider selection of investment options 

Retirement System Agree Neutral Disagree 

Don’t Know/No 

Response 

FERS 47% 26% 15% 12% 

CSRS 38% 24% 22% 16% 

Uniformed Services 51% 22% 19% 8% 

All Respondents 46% 24% 19% 12% 

Respondents were price sensitive to adding new options and none of the additional 

investment options that participants were asked to rate had a majority of 

respondents who were willing to add the funds if there would be additional costs 

associated with utilizing those funds. Nevertheless, there were between 18 and 30 

percent of participants who indicated that the TSP should provide various investment 

options even if the costs were higher. Providing a self-directed mutual fund window 
57 

would allow these participants the option of investing in these types of funds and paying 

the additional costs, while avoiding the burdens and costs of adding individual funds to 

the core line up of TSP funds. 

Fig. 35 Support for adding New Investment Options for the TSP – 2006 Survey 

Preferences About Additional Investment Options

29%

26% 23% 21%

26%

20%

29%

9%

53%

50%

54% 56%

52% 53%

48%

61%

18%

24% 23% 23% 23%

27%

23%

30%

Emerging

Markets Bond

Fund

Emerging

Markets

Stock Fund

High Yield

Bond Fund

International

Bond Fund

Precious

Metals Fund

Real Estate

Investment

Trust (REIT)

Fund

Socially

Responsible

Fund

Treasury

Inflation

Protected

Securities

(TIPS) Fund

Don't Add Fund Add if costs are about the same Add even if costs are higher

Thirty nine percent of all respondents indicated that this service would make the TSP a 

better program. This percentage across the retirement systems -- from a low of 29 

percent of respondents in the CSRS to a high of 46 percent of respondents in the 

uniformed services system – never exceeded 50 percent of respondents from any system. 

The potential take up or utilization of such an option is consistent with the findings in the 

2006 survey. About 24 percent of all respondents said they would transfer some of their 

TSP account balance to a self-directed mutual fund window. The highest support was in 

the unformed services where 30 percent of respondents indicated they would make such a 

transfer. 
58 

Once again, the need for professional advice appears to be a significant issue. Roughly 

half of all respondents in every retirement system agree they would need professional 

investment advice in order to use a self-directed mutual fund window. This kind of 

professional advice might be costly to provide. About 10 percent of respondents would 

be willing to pay $100 per year from their TSP account in order to use a self-directed 

mutual fund window. There is very little variation across retirement systems on that 

point. Sixty percent of all respondents would not be willing to pay $100 per year for this 

service, leaving 30 percent of respondents who might potentially be open to using this 

account option, if it were available. 

Fig. 36.1 Attitudes about adding a Self-Directed Mutual Fund Option – All respondents

 Agree Neutral Disagree Don't Know 

The TSP would be a better program if it provided a selfdirected mutual fund window. 

39% 24% 19% 19% 

I would transfer some of my TSP account balance to a 

self-directed mutual fund window. 

24% 24% 30% 22% 

I would need professional investment advice in order to 

use a self-directed mutual fund window. 

50% 20% 19% 12% 

I would be willing to pay an annual fee of $100, 

charged against my account balance, in order to use a 

self-directed mutual fund window. 

10% 16% 60% 14% 

“Great program. I like the idea of professionals’ advice and opening up to other 

investments stocks.” 

Fig. 36.2 Support for a Self-Directed Mutual Fund Option by Retirement System

% Agree 

CSRS FERS 

Uniformed 

Services All 

The TSP would be a better program if it provided a 

self-directed mutual fund window. 

29% 36% 46% 39% 

I would transfer some of my TSP account balance to 

a self-directed mutual fund window. 

17% 22% 30% 24% 

I would need professional investment advice in order 

to use a self-directed mutual fund window. 

49% 54% 48% 50% 

I would be willing to pay an annual fee of $100, 

charged against my account balance, in order to use 

a self-directed mutual fund window. 

9% 10% 11% 10% 
59 

Improving Participation in the TSP 

One area of potential interest is to consider what changes might be made to the program 

that would encourage more employees to become contributors. The most commonly 

cited method would be to add immediate matching contributions for new employees or 

uniformed service members. This was cited by 69 percent of all respondents and 80 

percent of uniformed service members. The next most common was automatic 

enrollment, cited by 51 percent of all respondents, followed by adding the Roth 401(k) 

feature (although at least some of this may be attributable to misunderstanding the tax 

implications of this option). Adding the self-directed mutual fund window which would 

greatly expand the investment options within the TSP is seen as having the least impact 

in attracting additional contributors. Ninety percent of respondents believe that with 

some modifications to the program, more employees would become contributors. 

Fig. 37 Potential Changes to Encourage More TSP Participation by Retirement System Which of the following changes to the TSP do you think would encourage more employees to become contributors to the 

TSP? 

CSRS FERS 

Uniformed 

Services All 

Add immediate matching contributions for new 

employees/uniformed service members 

54% 66% 80% 69% 

Enroll new employees/members automatically 55% 56% 46% 51% 

Add Roth 401(k) option 43% 41% 47% 44% 

Add self-directed mutual fund window option, which 

allows investments in mutual funds 

22% 23% 26% 24% 

Other 9% 9% 10% 9% 

 None of the above 9% 7% 4% 6% 

Participant suggestions regarding the TSP: 

“[Provide more] financial assistance to participants in planning long term for maximum 

retirement benefits” 

“Concise choices, but don't have biggest winners to pick from during bull market. Nice to 

have G fund during bear market.” 
60 

Conclusion on Proposed Changes 

The overall findings from this section are consistent with the fact that TSP participants 

have a high level of overall satisfaction with the program and are generally more 

conservative in their investment strategies and price-sensitive when considering changes. 

There was a significant decline from 2006 in the percentage of respondents who support 

the addition of a Roth 401(k) option. Some of the support for the Roth 401(k) option 

seems to be caused by misunderstanding the tax implications of this option, since many 

contributors indicated they would direct some or all of their TSP contributions into the 

Roth 401(k) if it became available even though it would be disadvantageous for them to 

do so based on their own assessment of their expected tax rate in retirement. 

In 2006, nearly half of all respondents indicated the TSP would be a better program if it 

provided additional investment options. When respondents were asked to evaluate 

specific investment options such as TIPS, REITs, or emerging markets funds, between 18 

percent and 30 of respondents were willing to add these funds, even if they cost 

significantly more than the TSP’s current investment funds. The self-directed mutual 

fund enhancement would address the desire of this segment of TSP participants by 

providing access to some or all of these options through the option of using a window at a 

brokerage firm. Almost two in five respondents (39%) indicated the TSP would be a 

better program if it provided this option and one in ten (10%) indicated they would be 

willing to pay an annual fee of $100 to use this option. 
61 

Part D. Impact of Financial and Economic Situation on TSP Contributions 

and Investments 

In the fall of 2008, the US and other global markets witnessed substantial market losses 

as a result of a financial meltdown. The resulting credit crunch has contributed to, if not 

caused, what appears to be a global recession. Many employees in the private sector 

have either lost their jobs or have become concerned over the potential impact on their 

employment situation. Even those with relatively secure job prospects may be making 

significant adjustments to their retirement savings to adjust to the new market conditions 

(both the decline in value and the increase in volatility). In the short run, these changes 

may focus on more conservative saving and investment strategies for some, while those 

who see a substantial decrease in their household income may reduce or eliminate their 

savings or take hardship withdrawals. In the long-run, many people may have to alter 

their retirement plans – either working longer or living with less. 

Survey participants were asked how the current financial situation was affecting them. 

While Federal employees or active members of the uniformed services may not face the 

same prospects of job loss as their private sector peers, they may face the same risks to 

household income from the job-loss of a spouse or other member of the household. 

To date, participants have not taken very many actions. The most common change was 

to transfer some or all of their account balance into the more secure G Fund (19 percent 

of respondents have already taken this action and 16 percent are considering it) as well as 

changing investment allocations of new contributions (11 percent have already done so 

while 17 percent are considering it). Almost one third of respondents (23 percent) are 

considering talking to a financial advisor or have already done so. 

Only seven percent of participants have already reduced their TSP contributions and only 

seven percent are considering doing so. Even fewer have stopped or are considering 

stopping their TSP contributions altogether. Nevertheless, there are some people who 
62 

are borrowing (4% have already done so and 5% are considering it) or withdrawing 

money from their accounts (3% and 5% respectively) as a response to the recent events. 

Fig. 38. Actions as a Result of Recent Market Conditions 

Panel A: All Respondents

Actions 

Already Taken 

Action 

Considering Taking 

Action 

No Action 

Expected 

Reduce my TSP contributions 7% 7% 86% 

Stop my TSP contributions altogether 7% 4% 90% 

Transfer all or some of my account balance to the 

G Fund 19% 16% 65% 

Change my allocation for investing new 

contributions 11% 17% 72% 

Borrow money from my TSP account 4% 5% 90% 

Withdraw money from my TSP account 

(hardship/age-based withdrawal) 3% 5% 92% 

I am separated/retired from service and I will 

withdraw some or all of my TSP account. 3% 9% 88% 

Speak with a financial advisor 9% 23% 68% 

Panel B: CSRS

Actions 

Already Taken 

Action 

Considering 

Taking Action 

No Action 

Expected 

Reduce my TSP contributions 7% 5% 88% 

Stop my TSP contributions altogether 9% 3% 88% 

Transfer all or some of my account balance to the G Fund 31% 17% 52% 

Change my allocation for investing new contributions 14% 15% 71% 

Borrow money from my TSP account 5% 5% 91% 

Withdraw money from my TSP account (hardship/agebased withdrawal) 

4% 5% 90% 

I am separated/retired from service and I will withdraw 

some or all of my TSP account. 

6% 11% 83% 

Speak with a financial advisor 9% 19% 71% 
63 

Panel C: FERS 

Actions 

Already Taken 

Action 

Considering 

Taking Action 

No Action 

Expected 

Reduce my TSP contributions 6% 7% 87% 

Stop my TSP contributions altogether 2% 4% 94% 

Transfer all or some of my account balance to the G Fund 19% 15% 65% 

Change my allocation for investing new contributions 12% 19% 69% 

Borrow money from my TSP account 5% 7% 88% 

Withdraw money from my TSP account (hardship/agebased withdrawal) 2% 6% 92% 

I am separated/retired from service and I will withdraw 

some or all of my TSP account. 2% 5% 92% 

Speak with a financial advisor 8% 26% 67% 

Panel D: Uniformed Services

Actions 

Already taken 

action 

Considering taking 

action 

No action 

expected 

Reduce my TSP contributions 7% 7% 85% 

Stop my TSP contributions altogether 8% 4% 88% 

Transfer all or some of my account balance to the G Fund 11% 15% 73% 

Change my allocation for investing new contributions 9% 18% 73% 

Borrow money from my TSP account 4% 5% 92% 

Withdraw money from my TSP account (hardship/agebased withdrawal) 2% 4% 94% 

I am separated/retired from service and I will withdraw 

some or all of my TSP account. 2% 10% 88% 

Speak with a financial advisor 9% 25% 67% 
64 

In Summary 

Results from the 2008 TSP Participant Survey indicate that Federal employees and 

uniformed services members are highly satisfied with the features and quality of service 

provided by the TSP. Overall, 81 percent of participants were “very satisfied” or 

“satisfied” with the TSP and 75 percent indicated as much about the overall quality of 

services provided by the TSP. While these results dipped slightly compared to the 

2006/2007 survey, this is likely attributed to the widespread uncertainty in the economy 

and financial markets, as the survey was administered in November 2008. The 2008 

results reaffirm that the TSP is an important retirement security vehicle for Federal 

employees and uniformed service members. 

The effects of market and economic turbulence on the survey results are difficult to 

pinpoint. However, the economy appears to be having a financial impact on Federal 

employees and uniformed services members, as respondents were more likely to report 

that they didn't have enough money to contribute to the TSP, compared to the 2006/2007 

survey. Participants also reported a shift since the prior survey towards more 

conservative investment strategies. However, most participants had not as of November 

made major changes to their retirement savings patterns in response to the financial and 

economic situation. For the participants, who have taken action or have considered it, 

“putting more of their account balance into the G Fund” and “changing how they invest 

their new contributions” were the most frequently selected options. 

The survey results also revealed participants’ reactions to potential enhancements to the 

TSP that are under consideration, namely adding a Roth 401(k) option and a self-directed 

mutual fun window. Slightly more than half of respondents prefer adding a Roth feature, 

but only a little more than a third have actually established a Roth IRA account. Many 

respondents indicated they would need professional advice on the tax implications of the 

Roth IRA before determining how much to invest in it, it at all. Nearly 40% of 

respondents support adding a self-directed mutual fund window, even if it costs 
65 

additional fees for participants electing to use the option. This closely aligns with results 

from the 2006/2007 survey, where participants indicated a strong interest in the TSP 

adding additional investment options, as long as the additional costs are reasonable. Ten 

percent of respondents in the current survey indicated they would be willing to pay an 

annual fee of $100 to use the self-directed mutual fund window. 

Given the importance that participants place on the TSP as critical to their retirement 

security, increasing participation in the TSP is of great interest. The most commonly 

cited enhancements to increase TSP participation by Federal employees and uniformed 

service members were automatic enrollment for new employees/members of the 

uniformed services and matching contributions for members of the uniformed services. 
66 

Appendix A: Demographics 

Fig. A.1 Age Distribution by Retirement System

CSRS FERS 

Uniformed 

Services 2006 2008 

N= 1369 1276 2180 4963 4825 

Less than Age 30 - 11.6% 12.0% 8.8% 8.6% 

30 to 39 - 14.0% 22.8% 14.8 14.1% 

40s 11.7% 25.2% 31.3% 26.2 24.1% 

50 to 59 36.3% 23.7% 25.8% 29.2 28.2% 

Age 60 and Over 51.6% 25.5% 8.2% 20.9 25.1% 

 Fig. A.2 Percentage Male and Female by Retirement System 

CSRS FERS 

Uniformed 

Services 2006 2008 

N= 1358 1256 2176 4917 4790 

Male 59.9% 54.9% 81.1% 66% 68.2% 

Female 40.1% 45.1% 18.9% 34% 31.8% 

 Fig. A.3 Annual Pay Distribution by Retirement System 

 

CSRS FERS 

Uniformed 

Services 2006 2008 

N= 1321 1244 2160 4840 4725 

Less than $40K 11.7% 22.2% 18.8% 21.9% 17.7% 

$40K to $60K 26.3% 32.6% 19.0% 25.6 24.6% 

$60K to $80K 20.0% 19.6% 18.0% 18.9 19.0% 

$80K to $100K 18.5% 13.7% 16.0% 15.4 16.1% 

$100K and Over 23.5% 11.9% 28.3% 18.3 22.6% 

 Fig. A.4 Percentage of Respondents Actively Employed by the Federal Government or 

Uniformed Services by Retirement System 

 

CSRS FERS 

Uniformed 

Services 2006 2008 

Active

 N= 898 1118 1396 3,883 3412 

 % 64.7% 86.5% 63.2% 76.9% 69.8% 

Retired (Q8.1) 

 N= 381 111 116 470 608 

 % 27.4% 8.6% 5.3% 9.3% 12.4% 
67 

Fig. A.5 Tenure Distribution by Retirement System 

 CSRS FERS 

Uniformed 

Services 2006 2008 

N= 1371 1274 2186 4985 4831 

Less than 2 0.0% 22.3% 0.8% 5.9% 6.3% 

2 to 4.9 0.0% 13.0% 6.8% 9.3% 6.5% 

5 to 9.9 0.0% 20.4% 13.6% 11.4% 11.6% 

10 to 14.9 0.4% 9.1% 11.8% 7.8% 7.8% 

15 to 19.9 1.6% 7.8% 13.2% 10.6% 8.5% 

20 to 24.9 4.0% 14.0% 22.4% 14.95 14.9% 

25 to 29.9 27.9% 7.1% 15.6% 17.5% 16.9% 

30+ 65.9% 6.2% 15.8% 22.7% 27.5% 

 Fig. A.6 Number of Different non-U.S. Government Employers Respondents Worked for 

by Retirement System 

CSRS FERS 

Uniformed 

Services 2006 2008 

N= 1301 1223 2090 4707 4614 

0 25.6% 15.9% 20.2% 19.0% 20.6% 

1 24.8% 19.0% 25.6% 23.0 23.6% 

2 20.5% 21.2% 20.1% 19.8 20.5% 

3 12.8% 14.8% 12.4% 14.3 13.2% 

4 6.0% 7.2% 7.0% 8.7 6.8% 

5+ 10.2% 21.9% 14.7% 15.2 15.3% 

 Fig. A.7 Distribution of Education Groups by Retirement System 

CSRS FERS 

Uniformed 

Services 2006 2008 

N= 1351 1258 2169 4887 4777

Some High School 0.7% 0.7% 0.1% 0.4% 0.4% 

High School Graduate 12.9% 11.0% 4.6% 8.9% 8.6% 

Some College 31.1% 25.2% 22.5% 27.2% 25.6% 

College Graduate 27.5% 29.2% 24.4% 26.3% 26.5% 

Some Advanced/Post-Graduate Education 10.0% 9.6% 11.2% 9.8% 10.4% 

Advanced/Post-Graduate Degree 17.8% 24.2% 37.3% 27.5% 28.4% 
68 

Fig. A.8 Distribution of Homeowner, Marital Status and Internet Access by Retirement 

System 

CSRS FERS 

Uniformed 

Services 2006 2008 

Homeowner 93.9% 80.6% 81.6% 83.4% 84.8% 

Married 71.1% 69.0% 77.3% 71.4% 73.3% 

 Married whose spouse is offered 

retirement plan 62.3% 60.5% 49.4% 57.6% 55.7% 

Internet Access 85.7% 90.4% 96.3% 89.5% 91.8% 

 High-speed 85.7% 89.2% 94.7% 79.6% 90.9% 

 Dial-up 13.5% 9.9% 4.4% 20.5% 8.2% 

Fig. A.9 Internet at Work by Retirement System 

CSRS FERS 

Uniformed 

Services 2006 2008 

Internet access at work all the time 54.8% 64.6% 71.6% 66.1% 65.1% 

Internet access at work on a limited basis 11.1% 17.1% 14.6% 15.4% 14.3% 

No Internet access at work 34.1% 18.3% 13.8% 18.5% 20.6% 
69 

Appendix B: Survey Instrument 
Page 1

Continued on next page...

November 17, 2008

Dear TSP Participant: 

I am pleased to inform you that you have been randomly selected to complete a confidential survey regarding the Thrift Savings Plan (TSP).

By completing the survey, your thoughts and impressions will directly contribute to our efforts to continually improve the TSP. 

This survey has been developed by an independent consulting firm in partnership with the Federal Retirement Thrift Investment Board. 

Your feedback will allow us to measure participant satisfaction with TSP plan features, services, and communications. The survey will also 

identify participant interest in new services and investment options. By improving our understanding of why participants join the TSP and 

make contributions, you will help us identify ways to increase TSP participation. 

Please complete the survey online by Wednesday, November 26, 2008, by using the web address listed at the bottom of this 

page; alternatively, you may complete this survey booklet and mail it in the enclosed pre-paid envelope by Wednesday, 

November 26, 2008. The survey should take about 30 minutes to complete. We are eager to receive your feedback and study your and 

other participants’ impressions of the TSP. Your feedback is extremely valuable, so I encourage you to participate in this survey. Please 

be assured that your individual responses to the survey will be kept strictly confidential. All responses will be collected and held in 

confidence by our independent consultant, Watson Wyatt Worldwide. 

On behalf of the TSP and its participants who will benefit from your responses to this survey, I thank you in advance for your efforts.

Very Truly Yours,

Gregory T. Long

Executive Director

Federal Retirement Thrift Investment Board

To complete your confidential survey online, please enter the following address into your web browser:

Participant Survey 2008

Thrift Savings Plan 

PRIVACY ACT NOTICE

The Federal Retirement Thrift Investment Board is authorized to solicit this information under Section 8474 of the Federal Employees’ 

Retirement System Act (Public Law 99-335). Your individual responses to the survey will be kept strictly confidential. Our staff and 

consultants will use the information to prepare summary statistical reports of all responses received. This information will help us improve 

our TSP communications and may lead to the introduction of new TSP features. Furnishing this information is voluntary. 

https://URL.TBD 

80970E-35411-4132-6297-1
INSTRUCTIONS

• If you make a mistake, please cross out your response, and mark your preferred response.

If you do not have an opinion on an item or it does not apply to you, select the "Don't Know / Not Applicable" response.

There is a set of responses for most questions in the survey. To answer any question, simply mark the response that corresponds

to your answer for that question by filling in the complete circle. Please use a black ballpoint pen.

•

•

We encourage you to submit your survey online by accessing the web address on the front of this booklet. If you complete this 

booklet instead, here are some tips to keep in mind:

the Thrift Savings Plan (TSP).

Part A: Please answer the following questions regarding retirement savings and your contributions to

Page 2

4. Why aren’t you currently contributing to the TSP? (Mark all that apply.)

I am contributing to the TSP. (Skip to question #5.)

I have already contributed the maximum amount allowed.

The TSP is too complex.

I don’t have enough money to save right now.

I’m saving in other ways.

I can’t access my money before I retire.

I’m not satisfied with the investment options.

I’m not sure how to sign up for the TSP.

I’m not eligible to participate in the TSP.

I'm a new employee, and I don't yet qualify for matching contributions.

My contributions were suspended because of my hardship withdrawal.

I am in the uniformed services and my contributions are not matched.

I have already separated from service.

2. What percentage of your pay are you currently contributing to the TSP? (Enter 0 if you are not contributing.)

Don't know

% of pay OR $ per pay period

1. In the past two years, have you contributed to the TSP?

Yes

No (Skip to question #4.)

3. Which of the following are your reasons for contributing to the TSP? (Mark all that apply.)

I’m not currently contributing. (Skip to question #4.) 

Tax benefits

Matching contributions

My supervisor/superior recommended that I do so.

A co-worker/friend recommended that I do so.

So I can retire when I want to.

Administrative costs are low.

Convenience of payroll deductions

Other, please specify

(Go to question #5)

Don’t know

2b. If you are age 50 or above, do you also make catch-up contributions?

Yes

No

*6297/2/2/* 80970E-35411-4132-6297-2

Correct Mark Incorrect Marks
Continued on next page...

Page 3

indicate the 2nd most important, and a “3” to indicate the 3rd most important source.

7. Rank your TOP 3 most important expected sources of retirement income. Use a “1” to indicate the most important, a “2” to 

Home equity

Income from my work

Other retirement plan (not TSP) from a non-Federal employer

Personal savings (including IRA funds)

Social Security

FERS/CSRS annuity 

Military pension

TSP account

Other (Please specify.)

Income from my spouse's work

Survivor annuity

DO NOT include your contributions to the TSP or your FERS/CSRS annuity or military pension. (Mark all that apply.)

6. If you have set aside money specifically for retirement, indicate the type of accounts where you have retirement savings. 

I have no other retirement savings accounts.

Bank/credit union account (not including checking accounts)

Traditional IRA 

Roth IRA

Other employer's tax-deferred account (e.g. 401(k), 457(b), or 403(b))

Mutual funds, stocks, bonds, or brokerage accounts (not tax deferred)

Other (Please specify.)

Other employer’s Roth 401(k)

amount as you currently earn, choose “100% or more.”

"40% to 59%;" if you think you will require the same 

you will require half as much annual pay, please choose 

comfortably when you retire? For example, if you think 

retirement pay do you think you will need in order to live 

5. Approximately what percentage of your annual preannual pay

40% of my

Less than

annual pay

59% of my

40% to

annual pay

79% of my

60% to

annual pay

99% of my

80% to

pay

my annual

more of 

100% or 

know

Don't

8. At what age do you plan to retire from all full-time employment?

I'm already retired. (Skip to question #12.)

Younger than 55

55 to 59

60 to 61

62 to 64

65

66 or older

Never retire

Don’t know

*6297/3/2/* 80970E-35411-4132-6297-3
Page 4

the next two years. ........................................................

9. I plan to stay with the Federal Government for at least 

Agree

Strongly Agree

Disagree

Agree Nor 

Neither Disagree

Disagree

Strongly

Applicable

Know/Not

Don't

Government until I reach retirement age. ....................

10. I plan to continue working for the Federal 

Indicate whether you agree/disagree with the 

following statements.

likelihood you will work for pay after you retire?

Government until you can retire. What is the 

11. Assume you continue to work for the Federal 

Likely

Very

Likely

Somewhat

Unlikely

Likely Nor 

Neither 

Unlikely

Somewhat

Unlikely

Very

Applicable

Know/ Not

Don’t

13. At what age do you anticipate starting to withdraw money from your TSP account? (Select only one option.)

I've already started withdrawals.

Before I am 55

55 to 59

60-64

65

66-70

701⁄2

Don't know

another employer’s 401(k) or from a traditional IRA? (Mark all that apply.)

15. Which of the following describes actions you have taken or would consider taking regarding an account from 

Not applicable (I have never had a 401(k) from another employer or traditional IRA account.)

I have already rolled another account into my TSP account.

I would consider rolling another account into my TSP account.

I would not consider rolling another account into my TSP account.

Don’t know

(but not my TSP account).

I have already rolled an account from another employer's 401(k) or traditional IRA into another account 

If not, please specify.

14. What level do you expect your tax rate to be after you retire in comparison to your tax rate today? 

Higher than today

Stay the same as today

Lower than today

I am already retired.

Don't know

are currently separated from service? (Mark all that apply.)

12. What do you plan to do with your TSP account balance when you separate from service, or what have you already done if you 

Leave it in the TSP until I need the money or am required to begin withdrawals at age 701⁄2

Take a single payment in cash

Receive monthly payments from the TSP

Purchase a TSP annuity

Receive a combination of a single payment, monthly payments, and/or TSP annuity

Roll over all or some of my account to an IRA

Roll over all or some of my account to a 401(k) plan with another employer

Don’t know

*6297/4/2/* 80970E-35411-4132-6297-4
18. When was the last time you called the TSP ThriftLine and spoke to a telephone service representative?

Within the last month

Within the last 6 months

Within the last year

More than a year ago

I have never called the ThriftLine.

Don’t know

17. How do you usually access/receive your TSP account information? (Mark all that apply.)

Online from work

Online from home

Receive quarterly paper statements

Review annual participant statements

Call the TSP ThriftLine

I don’t review it.

16. How often do you review your TSP account?

At least monthly

Quarterly 

Twice a year 

Annually 

Rarely 

Never 

Part B: The following questions are about the TSP benefits and services available to you.

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20. How did you determine where to invest your TSP money? (Mark all that apply.)

Made no investment decision (kept my money in the G Fund)

Selected an L Fund based on when I think I’ll need my TSP funds

Received advice from a financial professional

Received advice from family/friends

Received advice from co-workers

Reviewed TSP Web site/publications

Spoke with agency/uniformed services representative

Other (Please specify.)

None of the above

19. How would you describe your approach for investing the money in your TSP account? (Mark one response only.) 

Very aggressive - High risk

Somewhat aggressive - Moderate risk

Balanced between aggressive and cautious

Somewhat cautious - Low risk

Very cautious - No risk

Don't know/Not applicable

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explaining the benefits I receive from the plan. ..............

a. The information available about the TSP is helpful in 

Agree

Strongly Agree

Disagree

Agree Nor 

Neither Disagree

Disagree

Strongly

Applicable

Know/Not

Don't

contribute to the TSP. ....................................................

e. It’s easy to make changes to the amount of pay I 

is invested. .....................................................................

d. It’s easy to make changes to the way my TSP money 

account and investment performance. ...........................

statement is helpful for understanding my TSP 

c. The information provided in the annual participant 

make decisions about my TSP account. ........................

b. The information available about the TSP helps me 

f. Accessing my TSP account online is safe and secure. ..

program. ........................................................................

g. In the past two years, the TSP has become a better 

21. Indicate whether you agree/disagree with the following statements: (Select only one response per row.)

general plan features on the TSP Web site ...................

e. Ability to access information about my account and 

Satisfied

Very Satisfied

satisfied

Nor DisSatisfied

Neither 

satisfied

DissatisfiedVery DisApplicable

Know/Not

Don't

separation from service .................................................

d. Ability to withdraw money from my account after 

employed .......................................................................

c. Ability to borrow from my account while actively 

become eligible for agency contributions .......................

b. Waiting period required for a new FERS employee to 

contributions ..................................................................

a. Amount of agency/uniformed services matching 

23. Overall satisfaction with the TSP .............................

ThriftLine ........................................................................

general plan features through the automated TSP 

f. Ability to access information about my account and 

representatives (ThriftLine) ............................................

g. Quality of services provided by TSP telephone service 

submitted to the TSP .....................................................

h. Accuracy and timeliness of the processing of forms 

telephone service representatives) ................................

web-based services, automated ThriftLine, and TSP 

i. Overall quality of services provided by the TSP (i.e., 

22. How satisfied are you with each of the following characteristics of the TSP? (Select only one response per row.)

OVERALL SATISFACTION

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most TSP participants and improve the overall value of the program.

respond to the following questions, please consider whether you believe these changes would benefit

Part C: The TSP is considering changes to help participants better prepare for retirement. As you

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an option to contribute to a Roth 401(k). ................

a. The TSP would be a better program if it provided 

Agree

Strongly Agree

Disagree

Agree Nor 

Neither Disagree

Disagree

Strongly

Know

Don’t

to a Roth 401(k). ....................................................

b. I would contribute some or all of my contributions 

to a Roth 401(k) option. ..........................................

determining what, if any, amount I should direct 

c. I would need professional tax advice before 

TSP to provide this service. ....................................

available (at an additional cost), I would want the 

d. If professional tax advice could be made 

The TSP is considering adding a Roth 401(k) option. Participants would be allowed to elect some or all of their future contributions to 

be made to the Roth option, which has different tax treatment from the traditional TSP account (i.e., it is an after-tax option that 

accumulates earnings tax-free as opposed to a pre-tax option that is tax deferred). The addition of a Roth 401(k) option may increase 

the complexity of the plan, as tax planning is an important consideration when electing the Roth option. It may also modestly increase 

the expenses that all participants pay. Considering both the positive and negative aspects, indicate whether you agree or 

disagree with the following statements. (Select only one response per row.)

24.

(Mark all that apply.) 

26. Which of the following changes to the TSP do you think would encourage more employees to become contributors to the TSP? 

Enroll new employees/members automatically

Add self-directed mutual fund window option, which allows investments in mutual funds

Add Roth 401(k) option

Add immediate matching contributions for new employees/uniformed service members

Other, please specify

None of the above

a self-directed mutual fund window. .......................

a. The TSP would be a better program if it provided 

Agree

Strongly Agree

Disagree

Agree Nor 

Neither Disagree

Disagree

Strongly

Know

Don’t

balance to a self-directed mutual fund window. ......

b. I would transfer some of my TSP account 

window. ..................................................................

in order to use a self-directed mutual fund 

c. I would need professional investment advice 

use a self-directed mutual fund window. .................

charged against my account balance, in order to 

d. I would be willing to pay an annual fee of $100, 

The TSP is considering adding a self-directed mutual fund window. This new account option would be offered through a brokerage 

firm and allow participants to select from hundreds of publicly traded mutual funds in addition to the TSP’s core investment options. 

Additional plan fees would be charged to TSP participants electing to use the self-directed mutual fund window, in addition to fees 

charged by the brokerage firm and mutual fund managers. Considering both the positive and negative aspects, indicate whether 

you agree or disagree with the following statements. (Select only one response per row.)

25.

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Thank you for your participation!

Government/uniformed services. (Please round.)

7.

Years

which you have worked full time.

8. Number of different non-U.S. Government employers for 

9. Do you have Internet access from home?

Yes No

9a. If yes, is it high-speed or dial-up?

High-speed Dial-up

10. Do you have Internet access from work?

Yes, all the time

Yes, on a limited basis

No

6. Marital Status 

Single Married Widowed

retirement benefit by his or her employer? 

6a. If you selected “Married,” is your spouse offered a 

Yes No

5. Homeowner

Yes No

4. Highest Education Level

Some High School

High School Graduate

Some College

College Graduate

Graduate Education

Some Advanced/ PostGraduate Degree

Advanced/ Post3. Annual Pay

Less than $25,000

$25,000 to $40,000

$40,000 to $60,000

$60,000 to $80,000

$80,000 to $100,000

$100,000+

2. Gender 

Male Female

1. Age

Under 30

30-39

40-49

50-59

60-69

70 or over

Demographics

28. Please provide any comments or suggestions you have regarding the TSP. 

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c. Transfer all or some of my account balance to the G Fund ............

taken action

Have already

action

taking

Considering

expected

No action

withdrawal) .....................................................................................

f. Withdraw money from my TSP account (hardship/age-based 

h. Speak with a financial advisor ........................................................

all of my TSP account. ...................................................................

g. I am separated/retired from service and I will withdraw some or 

e. Borrow money from my TSP account .............................................

d. Change my allocation for investing new contributions ....................

b. Stop my TSP contributions altogether ............................................

a. Reduce my TSP contributions ........................................................

Given the recent events in the economy and financial markets, which of the following actions have you taken or are 

considering taking regarding your TSP contributions or investments? (Select only one response per row.)

27.

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Number of years employed by the Federal