Your TSP review should start with your employment status, pay records, account balances, and goals. An active service member making payroll contributions faces different choices from a separated veteran deciding what to do with an existing balance.
Check payroll contributions and matching
Under the Blended Retirement System, eligible participants can receive an automatic service contribution and matching contributions. Check the service rules, eligibility dates, and your actual pay records. Review the contribution rate across the year so an early limit does not unintentionally disrupt later matching opportunities.
Test a savings illustration and review its assumptions in the compound-interest calculator.
Use the correct annual limit
The IRS lists a $24,500 elective deferral limit for 2026. Other limits and catch-up rules depend on circumstances, including age, plan participation, and types of pay. Do not add every published limit together. If you contribute to another employer plan during a transition year, check how the limits interact with TSP contributions.
Start with IRS contribution guidance and TSP contribution limits. Confirm the applicable year before changing payroll elections.
Compare tax treatment before changing elections
Traditional and Roth treatment affects when contributions or distributions may be taxed. A Roth label does not mean every withdrawal is automatically tax-free; qualification rules matter. Read the traditional-versus-Roth guide and consider current income, expected withdrawals, and applicable tax rules. A conversion is a separate decision that may create a current tax cost.
Choose investments around the use of the money
Review the available funds, their risks, and current expenses using TSP’s fund information. Lifecycle funds provide an allocation approach tied to a time horizon, but a date alone does not establish suitability for every person. Investment values can fall. Avoid selecting an assumed return just because it produces a desired forecast.
Run an illustration you can explain
Use the retirement growth calculator to compare different contribution amounts and illustrative returns. At 0% growth, $10,000 plus $200 per month for 10 years totals $34,000 before fees or taxes. Positive-return projections add an assumption, not a promise.
Separate account management from rollover decisions
Before moving money after separation, compare fees, investments, withdrawal rules, tax treatment, and service features. Review any outstanding TSP loan and account notices. The separation guide provides a decision checklist. Keep beneficiary and contact information current.
Official overview: Military OneSource: Federal Thrift Savings Plan. This educational guide does not select an investment or tax strategy for an individual.