1. What is TSP?

The Thrift Savings Plan (TSP) is a retirement savings and investment plan for federal employees and members of the uniformed services. It provides similar savings and tax benefits to private-sector 401(k) plans.

2. How Does the Calculator Work?

The calculator uses the basic TSP formula:

Where:

• \( Contributions \) — The total amount you've contributed to your TSP account
• \( Earnings \) — The investment gains from your TSP account

Explanation: This simple formula helps you understand how your contributions and investment returns combine to create your total TSP balance.

3. Importance of TSP Calculation

Details: Tracking your TSP balance helps with retirement planning, understanding your investment growth, and making informed decisions about contribution amounts and investment choices.

4. Using the Calculator

Tips: Enter your total contributions in USD and your total earnings in USD. Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What's the difference between contributions and earnings?
A: Contributions are the amounts you (and potentially your employer) put into the account. Earnings are the investment returns generated by those contributions.

Q2: How often should I check my TSP balance?
A: While you can check daily, most financial advisors recommend reviewing quarterly for long-term investors to avoid overreacting to short-term market fluctuations.

Q3: Are TSP contributions tax-deductible?
A: Traditional TSP contributions are made pre-tax, reducing your taxable income. Roth TSP contributions are made after-tax but grow tax-free.

Q4: What's the maximum I can contribute to TSP?
A: For 2023, the elective deferral limit is $22,500 ($30,000 if age 50 or older). There are separate limits for special categories.

Q5: How are TSP earnings calculated?
A: Earnings depend on how your money is invested across the various TSP funds (G, F, C, S, I, and L funds) and their performance.