Recommended TSP Balance at Age 50
Federal employees have unique retirement needs, so it’s important to focus on savings guidelines tailored to you. While private-sector benchmarks suggest saving six times your pre-retirement income by age 50, federal employees are generally advised to have a TSP balance of around four times their annual salary. This lower target reflects the additional security provided by the FERS pension. If you haven’t reached this milestone yet, there’s still time, especially with the option to make catch-up contributions once you turn 50.
Maximize Your Agency Match
Don’t leave free money on the table. Federal agencies match up to 5% of your TSP contributions: the first 3% is matched dollar-for-dollar, and the next 2% is matched at 50 cents on the dollar. Combined with compound growth, these contributions can significantly boost your retirement savings. Once you hit the annual TSP limit, any extra contributions automatically count toward catch-up contributions.
TSP Catch-Up Contributions for Age 50+
When you turn 50, you can make catch-up contributions in addition to your regular TSP contributions. For 2025, the catch-up limit is $7,500 on top of the standard $23,500 TSP limit. Contributions beyond the standard limit automatically roll over into catch-up contributions, and your agency continues matching up to 5% of your salary.
Enhanced Catch-Up Contributions for Ages 60–63
The Secure Act 2.0 allows participants aged 60–63 to make even larger catch-up contributions. Starting January 1, 2025, eligible employees can contribute an extra $11,250. These limits will adjust for inflation over time, providing a major opportunity to reach or exceed your recommended TSP balance.
Planning for a federal retirement comes with unique challenges, especially since most retirement advice is geared toward private-sector employees without pensions like the FERS annuity. Working with a Federal Retirement Consultant (FRC®) can help you navigate these rules, align your savings strategy, and make sure your retirement plan is on track.
