The Thrift Savings Plan (TSP) is a defined contribution plan for United States civil service employees and retirees as well as for members of the uniformed services. It is a retirement savings and investment plan that offers federal employees and members of the uniformed services the same type of savings and tax benefits that many private corporations offer their employees under 401(k) plans. The TSP is administered by the Federal Retirement Thrift Investment Board, an independent agency.

The TSP is a defined contribution plan, meaning that the retirement income you receive from your TSP account will depend on how much money you put into your account during your working years and the earnings accumulated over time. Participants in a TSP can get an immediate tax break for their savings and can also choose to invest in a Roth for freedom from taxes after retirement. The TSP offers a choice of six funds and a mutual fund option.

Some key features of the TSP include:

• Eligibility: The TSP is one of three components of the Federal Employees Retirement System (FERS; the others being the FERS annuity and Social Security) and is designed to closely resemble the dynamics of private sector 401(k) and Roth 401k plans.
• Matching contributions: The TSP offers matching contributions for federal employees.
• Investment options: The TSP offers a choice of six funds and a mutual fund option.
• Rollovers: Employees new to federal employment can roll over 401(k) and individual retirement account (IRA) assets into a TSP.

To participate in the TSP, federal employees must make a contribution election through their agency or service to start, stop, or change their contributions. The total tax-deferred, tax-exempt, and agency contributions made to both TSP accounts are subject to the IRC Section 415(c) overall limitation, which is $58,000 for 2021.