TSP Set to Provide Military with 401k Plans

December 26, 2015

Thrift savings plan

Also Read: 3 Reasons Certain Federal Employees Can Retire Years Earlier Than Their Peers Without Penalties
Also Read: CSRS Retirement in 2024: Are You Making the Most of What This Classic Plan Has to Offer?
Also Read: Roth IRA Basics for Beginners: What’s There to Learn?

has always been prone to modifications as it affects so many people from all over the country. It has seen many expansions been made to it over the years and recently the congress has proposed to expand TSP even further and now the military servants of the nation would be able to give their applications and apply for the retirement plans that they have always wanted to get their hands on. It’s expected that this would mean that the TSP database will see over hundred thousand new members to the least and could cost millions of dollars. That being said, the TSP board believes that they are pretty much up to the task and they think that they can inculcate the army without having to do any paradigm shifts.

The recommendation of the military compensation and modernization of retirement committee back in the start of 2015 to make the move for all the military officers from the obsolete pension system (that accounts for people who have served for at-least 20 years) to a more concrete one that would include the TSP and a pension has finally gotten some recognition. The Congress has moved in and made some legislative announcements in heed of this matter.

This new plan could be exactly the thing that the service members might have been after; this would allow them to make their contributions to the retirement funds go up to at-least 5 percent of their current pay. This may also include a 1 percent (give or take) base without regard of the levels of contribution.

This plan is definitely a step in the right direction and it should mean that around 800 thousand service officers would be introduced to the new system in the first year of its inception and from then on in, there could be an inflow of over a 100 thousand member every year.