Thrift Savings Plan

Plan your retirement savings with a clearer understanding of how your TSP works.

TSP

Thrift Savings Plan

The Thrift Savings Plan (TSP) is a retirement savings program for federal employees and uniformed service members. You can invest your money in conservative, low-risk funds or in growth-focused stock and international funds. You can also choose a Lifecycle Fund that automatically adjusts your investments as you get closer to retirement.

Simplifying The Funds

G Fund	The payment of G Fund principal and interest is guaranteed by the U.S. Government. This means that the U.S. Government will always make the required payments. The G Fund rate is calculated by the U.S. Treasury as the weighted average yield of approximately 136 U.S. Treasury securities on the last day of the previous month.
F Fund	The F Fund invests in fixed-income securities and tracks the Bloomberg Barclays U.S. Aggregate Bond Index, a broad collection of U.S. bonds with maturities over one year. Because the index includes so many securities, the fund invests in a representative sample selected by BlackRock Institutional Trust Company, N.A. The F Fund’s performance is measured by how closely it matches the overall bond market, providing stability and steady returns.
C Fund	The C Fund invests in U.S. large and medium-sized companies and tracks the S&P 500 Index. This index represents 500 major companies across most industries, covering about 82% of the U.S. stock market. The fund aims to match the performance of the U.S. stock market and offers long-term growth potential.
S Fund	The S Fund invests in U.S. small and mid-sized companies not included in the S&P 500, following the Dow Jones U.S. Completion TSM Index. It uses a representative sample of stocks to efficiently track the index and reserves a portion of assets for daily fund activity. This fund offers growth potential but can experience more market fluctuations.
I Fund	The I Fund invests in international stocks from developed countries outside the U.S., tracking the MSCI EAFE Index. This index covers major companies in Europe, Australasia, and the Far East across 21 countries. The fund holds stocks in similar proportions to the index and is designed to help diversify your portfolio globally.

Lifecycle (L) Funds

Lifecycle Funds combine the five TSP funds (G, F, C, S, and I) and adjust automatically over time based on your expected retirement or withdrawal date. Funds closer to retirement focus on preserving assets, while funds farther from retirement focus on long-term growth. Each fund is rebalanced daily, adjusted quarterly, and rolls into the L Income Fund at its target date.

Fund	Target Withdrawal	Growth vs Preservation	Notes
L Income Fund	Already withdrawing or soon	Low growth, high preservation	For participants taking monthly payments now or very soon
L 2030	2028–2032	Moderate to high growth, low preservation	Rolls into L Income Fund in July 2030
L 2035	2033–2037	Moderate to high growth, low preservation	Rolls into L Income Fund in July 2035
L 2040	2038–2042	High growth, low preservation	Rolls into L Income Fund in July 2040
L 2045	2043–2047	High growth, low preservation	Rolls into L Income Fund in July 2045
L 2050	2048–2052	High growth, very low preservation	Rolls into L Income Fund in July 2050
L 2055	2053–2057	High growth, very low preservation	Rolls into L Income Fund in July 2055
L 2060	2058–2062	High growth, very low preservation	Rolls into L Income Fund in July 2060
L 2065	2063+	High growth, very low preservation	Rolls into L Income Fund in July 2065

Phases of TSP

1

Accumulation Phase

This phase starts when you begin saving for retirement and continues until you start taking withdrawals. For most people, it covers your entire working career. The focus is on contributing regularly and growing your retirement savings over time.

2

Maximization Phase

This phase is about contributing as much as possible to your TSP. For 2026, the maximum contribution is $24,500 for participants under 50. Those 50 or older can make catch-up contributions of $8,000, and participants aged 60–63 can add up to $11,250 more, bringing the total to $35,750.

3

Distribution Phase

The distribution phase begins when you retire or separate from federal service and start using your TSP savings. Retirement planning at this stage goes beyond finances, including lifestyle choices, when to fully retire, where to live, and how to make your savings last.

TSP Distribution Methods

When you retire or leave federal service, you have three main ways to withdraw money from your TSP:

Installment Payments

Receive money monthly, quarterly, or annually. You can choose a fixed amount or base it on life expectancy.

Single Withdrawals

Take out a specific amount all at once.

Annuity Purchases

Use your TSP balance to create a steady income stream for life.

You can also combine these methods, and there’s no limit to the number of withdrawals you can take. It’s a good idea to consult a financial professional to understand taxes, benefits, and the best approach for your situation.

Required Minimum Distribution

RMD requirements

If you have left federal service and haven’t started TSP withdrawals, the IRS requires you to begin by:
- Age 73 if you were born before 1960
- Age 75 if you were born in 1960 or later

If you separate from federal service after age 73, your account will immediately be subject to the IRS minimum distribution requirements.

If you’re already receiving a series of monthly payments from your TSP account when you turn 73, your monthly payments will be used to satisfy the IRS minimum distribution requirement. If the total amount of your monthly payments does not satisfy the requirement, TSP will issue a supplemental payment for the remaining amount in December.

If you’re a beneficiary participant, your deadline for beginning to receive required minimum distributions depends on whether your spouse died before or after his or her required beginning date.

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