Four Important Considerations for Your TSP Account in the New Year

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Four Important Considerations for Your TSP Account in the New Year

As we welcome a new year, it’s a great time to reflect on your Thrift Savings Plan (TSP) account and how you can make the most out of your investments. Whether you’re a seasoned investor or just starting, here are four important things to keep in mind as you manage your TSP in the coming year.

  1. Review Your Investment Allocations

One of the first steps you should take at the beginning of the year is to review your investment allocations. The TSP offers various funds, including the G Fund (Government Securities), F Fund (Fixed Income), C Fund (Common Stocks), S Fund (Small Capitalization Stocks), and I Fund (International Stocks). Consider your risk tolerance, retirement timeline, and market conditions when deciding whether to rebalance your portfolio. Adjusting your allocations can help you stay aligned with your financial goals.

  1. Maximize Your Contributions

Highlights of changes for 2024. The contribution limit for employees who participate in 401(k), 403(b), and most 457 plans, as well as the federal government’s Thrift Savings Plan is increased to $23,000, up from $22,500. The limit on annual contributions to an IRA increased to $7,000, up from $6,500. Even small increases may have a significant impact on your retirement savings over time.

  1. Stay Informed About Changes

Each year, the federal government may introduce new regulations or changes to the TSP. Stay informed about any updates regarding contribution limits, withdrawal options, and fund performance. Understanding these changes may enable you to make informed decisions about managing your TSP account and ensure you’re taking full advantage of all available benefits.

  1. Consider Your Withdrawal Strategy

If you’re approaching retirement, now is the time to think about how you will withdraw funds from your TSP account. Understanding your options, whether it’s a lump-sum withdrawal, monthly payments, or a combination of both, is crucial. It’s also essential to consider the tax implications of your withdrawals. Consulting with a financial advisor can provide you with tailored strategies to make the most of your retirement savings.

As you embark on another year of saving and planning for retirement, keeping these four important considerations in mind will help you manage your TSP account effectively and work towards your long-term financial goals. Happy investing in the new year!

Saving In Your Thrift Savings Plan (TSP) Is Important For Several Reasons

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Saving In Your Thrift Savings Plan (TSP) Is Important For Several Reasons

  1. Retirement Security: The TSP is a powerful tool for building a nest egg for retirement. It helps ensure you have enough funds to maintain your lifestyle when you stop working.
  1. Tax Advantages: Contributions to the TSP can be made on a pre-tax basis, reducing your taxable income for the year. This means you’ll pay less in taxes now, allowing your savings to grow tax-deferred until you withdraw the funds in retirement.
  1. Employer Matching Contributions: If you’re a federal employee, your agency may offer matching contributions to your TSP account. Not taking full advantage of these matches is effectively leaving free money on the table.
  1. Diversification of Investments: The TSP offers a variety of investment options across different asset classes, allowing you to diversify your portfolio. This can help manage risk and potentially improve your returns over time.
  1. Low Fees: The TSP generally has lower fees compared to many other retirement savings plans. Lower fees can mean more of your money stays invested and grows over time.
  1. Flexibility in Withdrawals: The TSP provides various withdrawal options including lump-sum withdrawals, monthly payments, or annuities, giving you flexibility in how you access your savings once you retire.
  1. Financial Education and Resources: The TSP offers resources and tools to help you understand your investments and make informed decisions, which can aid in better financial planning.

Overall, saving in your TSP is crucial for securing your financial future and can provide you with a robust foundation for retirement.

Are You Ready for FEHB Open Season? 

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Are You Ready for FEHB Open Season? 

Open Season for the 2025 FEHB plan year is underway. Here is some information to help. 

The federal benefits Open Season for the 2025 plan year begins November 11, 2024, and runs through December 9, 2024. This is the event where federal employees and retirees choose their benefits for next year.

During Open Season, you can enroll in new health insurance coverage under the Federal Employees Health Benefits (FEHB) program, change plans or plan options, change enrollment type (to Self, Self Plus One or Self and Family) or cancel coverage. Follow link to read more from FedSmith. https://www.fedsmith.com/2024/11/11/are-you-ready-for-fehb-open-season/

Open Season Just Ahead; Transition to New Program Begins for Postal Employees, Retirees

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Open Season Just Ahead; Transition to New Program Begins for Postal Employees, Retirees

While for decades that has meant only the FEHB, Postal Service employees and retirees will be shifted to the PSHB, essentially a carve-out program with many similarities but also some key differences. Image: The Image Party/Shutterstock.com 

The annual federal benefits open season running from next Monday (November 11) through December 9 will offer the usual range of choices in the Federal Employees Health Benefits program and also notably will start the transition of Postal Service employees and retirees into the new Postal Service Health Benefits program beginning in January. Follow link to read more from FEDweek. Open Season Just Ahead; Transition to New Program Begins for Postal Employees, Retirees

Are You Making This Mistake During FEHB Open Season?

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Are You Making This Mistake During FEHB Open Season?

FEHB premiums are rising sharply as seen in the BCBS historical costs. Failing to analyze and compare plans during Open Season could be a big mistake. 

It’s that time of year again. You know, the time you anxiously anticipate annually. Yes, it’s Open Season for federal employee health benefits “FEHB,” dental and vision coverage “FEDVIP,” and the Flexible Spending Account “FSA.” Starting November 11 and running through December 9, you’ll have the opportunity to enroll in, cancel or change your current FEHB, FEDVIP and enroll in FSA if you’re still employed. Follow link to read more from FedSmith. https://www.fedsmith.com/2024/11/08/dont-make-this-mistake-during-fehb-open-season/