January 27, 2014
Participation in the Thrift Savings Plan took a dive at the end of 2013, though assets in the plan grew to an all-time high.
Just 85.9 percent of employees enrolled in the Federal Employees Retirement System maintained TSP accounts at year’s end, a full percent lower than earlier in 2013. Uniformed services participation fell to 39.5 percent. Participation typically drops off in December, officials on the Federal Retirement Thrift Investment Board said Monday, as employees often hit their statutory $17,500 contribution cap before the end of year.
“Fingers crossed” federal workers will re-enroll in early 2014, said Renee Wilder, FRTIB’s director of the Office of Enterprise Planning.
Assets in TSP rose to more than $397 billion in 2013, a record high. FRTIB officials were also pleased with the number of enrollees who opted for Roth accounts, which jumped 191 percent to more than 294,000 participants. Roth assets increased by 623 percent in 2013.
TSP felt the effects of a tough year for federal employees, with participants turning in record numbers to their retirement accounts to help them through a year of frozen pay and furloughs. About 291,000 feds took out loans on their plans and an additional 138,000 made hardship withdrawals, both 10-year highs.
Officials said members of the Senate considering an overhaul to the U.S. Postal Service have heard their concerns with the provisions of the legislation that affect the TSP. An amendment to the bill would still enable USPS to bargain with unions over the contributions to the plan for new employees, but would require the agency to come to one agreement with all four postal unions.
“They mitigated our biggest concerns,” said Kim Weaver, FRTIB’s director of external affairs, “but we still aren’t wild about the TSP being balkanized in this way.”
TSP officials also noted markets have tumbled in recent weeks, leading most of the plan’s offerings to drop so far in January.
(Image via Kenishirotie/Shutterstock.com)
January 27, 2014