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TSP

Administered by the Federal Retirement Thrift Investment Board, this defined contribution plan for federal employees has roughly 4,614,874 participants, and over $358 billion in assets under management. Ask your TSP questions and post related topics here.

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VAer1  
#1 Posted : Friday, May 1, 2020 7:40:15 AM(UTC)
VAer1

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Google Drive link: https://drive.google.com...0-bYo3RyBJStMJKLbjRi-et7

It was presented by a chartered federal employees benefit consultant, and I did not really attend whole presentation, so I am more relied on reviewing Power Point on my own.

I don't quite understand this slide. For example, what does 28% mean?

Employees with more than 50-years old: contribute average 28% of salary to TSP? It does not make sense, there are tax, insurance, etc, if 28% contribution, then there is little take-home pay.

Employees with less than 50-years old: make up 28% of TSP funding pool? It does not make sense too, there are more than half of federal employees under 50 years old, how can they have only 28%?
https://www.opm.gov/poli...anent-age-distributions/

What could be the percentage number mean? The slide title "How much should I contribute to my TSP", it makes the graph looking like suggested contribution percentage of salary.

Thanks.

Edit: It could make sense that employees under 50 years old make up 28% of TSP funding pool. There is slightly more than 50% employees under 50 years old, it is possible than average older employee has almost three times of TSP balance than average younger employee. Older employee has accumulated more contribution, and they may contribute more each month (due to higher salary) and catch up too. But the percentage does not match slide title.

Edited by user Friday, May 1, 2020 7:48:39 AM(UTC)  | Reason: Not specified

smithandjones  
#2 Posted : Friday, May 1, 2020 10:45:19 AM(UTC)

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The slide is as meaningless as is most information from benefits “consultants.” It appears to be trying to tell people they should contribute more as they get older but doesn’t have enough information to be clear. It seems to be some sort of independent recommendation. Whatever. But it is true that as people get older they take retirement more seriously and, perhaps, have less debt and earn more. Over 50 can save more tax free due to the additional catch-up allowance.

I do believe you should make maximum use of the TSP at any age. Tax free savings is nothing to sneeze at regardless of the investment returns. If you get some investment returns then that is even better. And the match is a no brainer.

old fed  
#3 Posted : Friday, May 1, 2020 10:57:13 AM(UTC)
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Originally Posted by: VAer1 Go to Quoted Post
Google Drive link: https://drive.google.com...0-bYo3RyBJStMJKLbjRi-et7

It was presented by a chartered federal employees benefit consultant, and I did not really attend whole presentation, so I am more relied on reviewing Power Point on my own.

I don't quite understand this slide. For example, what does 28% mean?

Employees with more than 50-years old: contribute average 28% of salary to TSP? It does not make sense, there are tax, insurance, etc, if 28% contribution, then there is little take-home pay.

Employees with less than 50-years old: make up 28% of TSP funding pool? It does not make sense too, there are more than half of federal employees under 50 years old, how can they have only 28%?
https://www.opm.gov/poli...anent-age-distributions/

What could be the percentage number mean? The slide title "How much should I contribute to my TSP", it makes the graph looking like suggested contribution percentage of salary.

Thanks.

Edit: It could make sense that employees under 50 years old make up 28% of TSP funding pool. There is slightly more than 50% employees under 50 years old, it is possible than average older employee has almost three times of TSP balance than average younger employee. Older employee has accumulated more contribution, and they may contribute more each month (due to higher salary) and catch up too. But the percentage does not match slide title.


it means the sooner you start the better. if you want a good retirement but wait until you're older you'd have to contribute a greater percentage of your salary.

I'm not sure what their reference point/goal is regarding the graph, I'm guessing it was in a different slide?
thanks 1 user thanked old fed for this useful post.
roger.d on 5/1/2020(UTC)
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