The Thrift Savings Plan.
The 401(k) for federal employees, with the lowest fees on Earth.

Section 1 · TSP basics

The Thrift Savings Plan is the retirement savings plan for federal civilian employees and uniformed-services members.

Contribution limits

2026: $24,500 ($32,500 with the 50+ catch-up) verify×DON'T TRUST, VERIFYClaim: 2026 TSP elective-deferral limit is $24,500 with $8,000 catch-up at 50+.Verify at: tsp.gov ↗TSP follows the same IRC 402(g) limit as private 401(k)s..

Employer match (FERS only)

• FERS (Federal Employees Retirement System) employees: up to 5% match.
• Automatic 1% contribution even if you contribute nothing.
• Dollar-for-dollar match on your first 3%.
• 50 cents on the dollar for the next 2%.
• CSRS (Civil Service Retirement System, older system) employees: no match.

Section 2 · The TSP funds

Five core index funds with among the lowest expense ratios in existence (typically around 0.04%):

• G Fund: Government Securities. Unique. Earns long-term Treasury rates but is redeemable at any time with no price risk. The G Fund has no equivalent outside the TSP verify×DON'T TRUST, VERIFYClaim: The G Fund is invested in nonmarketable special-issue Treasury securities and is redeemable at par at any time.Verify at: TSP G Fund ↗G Fund earns the average yield of long-duration Treasury securities while pricing like cash. There is no commercial equivalent..
• F Fund: Fixed Income Index. Tracks the Bloomberg US Aggregate Bond Index.
• C Fund: Common Stock Index. Tracks the S&P 500.
• S Fund: Small Cap Stock Index. Tracks the Dow Jones US Completion Total Stock Market Index (everything in the US market outside the S&P 500).
• I Fund: International Stock Index. Tracks MSCI ACWI ex-US IMI Index (developed and emerging markets).

Lifecycle funds (L Funds)

Target-date funds that mix the core funds (L 2045, L 2050, etc.). Appropriate for hands-off investors.

Section 3 · Roth TSP

The Roth TSP works like a Roth 401(k):

• Contributions after-tax.
• Growth tax-free.
• Same contribution limits as Traditional TSP.
• Unlike Roth IRAIndividual Retirement Account (IRA)A personal retirement savings account with tax advantages. Two main types: Traditional (tax now, pay later) and Roth (pay now, tax-free forever).Full definition: no income limits for Roth TSP contributions.

Roth TSP can be rolled to a Roth IRA at separation. An important option since TSP requires RMDsRequired Minimum Distribution (RMD)The minimum amount you must withdraw from Traditional retirement accounts each year starting at age 73.Full definition at 73 but Roth IRAs do not.

Section 4 · TSP loans and withdrawals

TSP loans

• Available but should be treated as last resort.
• Two types: general purpose (5 years) and residential (15 years for primary home).
• Repaid with after-tax dollars: a hidden cost.

In-service withdrawals

• Age 59½+: standard withdrawals.
• Financial hardship: limited circumstances.

Section 5 · TSP + pension planning (FERS three-part retirement)

FERS employees have a three-part retirement:

• TSP (like a 401(k)).
• FERS pension: 1% of high-3 salary × years of service (or 1.1% if retiring at 62+ with 20+ years).
• Social Security (FERS employees pay into and qualify).

The combination is powerful, but the TSP portion still matters. Maxing TSP contributions in the C/S/I funds during a 30-year career produces a multi-million-dollar balance with virtually no fee drag verify×DON'T TRUST, VERIFYClaim: FERS basic annuity formula is 1% of high-3 average salary per year of service (1.1% if retiring at 62+ with 20+ years of service).Verify at: OPM Retirement Services ↗FERS basic annuity computation is documented in CSRS/FERS Handbook..