Page 70 - Foreign Service Journal - March 2013

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70
MARCH 2013
|
THE FOREIGN SERVICE JOURNAL
AFSA NEWS
AFSA hosted the fourth ses-
sion in its Federal Benefts
Speaker Series on Feb. 11.
Randy Urban, of the Federal
Retirement Thrift Investment
Board, gave a Thrift Savings
Plan pre-separation briefng
to AFSA members focused
on contribution rules, invest-
ment considerations, and
withdrawal options, both
in-service and post-service.
More than 85 AFSA mem-
ber’s attended the event.
Beginning with contribu-
tion rules, Mr. Urban stressed
that the most important
AFSA Speaker Series: TSP Pre-Separation Briefng
BY MATTHEW SUMRAK , ASSOCI ATE COORDINATOR FOR RET I REE COUNSEL ING AND LEGI SLAT ION
thing to remember is that
agency contributions are
“free government money,”
and you do not want to lose
out on getting the full 4
percent match that every
employee is entitled to.
He also recommended
that TSP monthly contribu-
tions are spread throughout
the entire year so you do
not max-out your agency’s
contribution limit early in
the year. The current limit is
$17,500.
He reminded the audience
that one can start, stop, or
change their contribution at
any time. Every FERS/FSPS
employee automatically
receives a 1 percent agency
contribution. To maximize
both your and your agency’s
contribution, Urban strongly
encouraged everyone to go
to the TSP Web site at
www.
tsp.gov. Th
eir calculators will
help you to decide the right
amount to contribute.
When investing with TSP,
keep in mind how long it
will be before you will use
your investment. In most
cases, that will be sometime
after you retire. Also worth
considering is diversifcation
and risk tolerance, followed
by infation and taxes. It is
important to understand the
tax implications for with-
drawing funds.
The last consideration
is investment costs. TSP
pays for itself and receives
no government money;
despite this they have very
low investment costs. As of
2012, the average expense
for administrative and invest-
ment management fees were
$0.27 for every $1,000. Com-