The Employee Thrift Advisory Council, of which NTEU is a member, met with the Federal Retirement Thrift Investment Board staff yesterday. The Board presented the Council with updates on various Thrift Savings Plan (TSP) programs. First, the additional withdrawal options, which were championed by NTEU, should be available by the fall of 2019. They plan to eliminate the age 70 withdrawal deadline, and to allow monthly, quarterly, and annual installment payments, instead of only a monthly option. In addition, there will be no limit to post separation withdrawals, and up to four age-based in-service withdrawals will be available. The participant will then be able to decide whether the installments come from the traditional TSP or the Roth TSP. They will officially announce these changes in January.
In recent months, the TSP has become a greater part of military retirement based on earlier changes by Congress for military personnel retirement benefits. This is translating into higher numbers of overall TSP participants, so the Board has opened an additional call center with the goal of offering better and faster customer service.
The Board also shared with the Council its intention to create a new glide path for the L (Lifecycle) Funds. These funds provide a mix of investments that follows the target date of an individual’s retirement. I mentioned in an earlier post that the current L funds will expand into five-year increments instead of from their current ten-year increments. In addition, the funds will start out with a 99% stock investment allocation instead of the current 90% and will gradually switch from stocks to bonds as the target retirement age is met.
I will keep you updated on the progress of these changes.