A weekly roundup of pay and benefits news.
Officials at the federal government’s 401(k)-style retirement savings program announced on Monday that the Thrift Savings Plan has awarded a new recordkeeping services contract to Accenture Federal Services, which will provide participants with a number of new account management features in the coming years.
TSP Participant Services Director Tee Ramos announced the contract at Monday’s monthly meeting of the Federal Retirement Thrift Investment Board, which administers the retirement program. Following an 18-month transition period to the new vendor, Ramos said participants can expect to see a variety of new features that will make managing their accounts easier.
“On Friday, Nov. 13, [TSP Executive Director] Ravi [Deo] signed the contract with Accenture Federal, and they will provide a modernized experience while maintaining and increasing the high level of service that TSP customers have grown to expect,” Ramos said. “New features will include a mutual fund window, e-signature capabilities and a mobile app, which is set to be available in mid-2022.”
A mobile app was specifically cited by most younger participants as their most-wanted new feature from the TSP as part of a recent survey of participants, in addition to a statement that compiles the status of one’s Social Security, defined benefit annuity and TSP balance all at once.
The TSP also published finalized regulations in the Federal Register on Monday to allow the program to simplify catch-up contributions for older participants, a change that will be implemented on Jan. 1.
Currently, federal workers age 50 and older may exceed the annual cap in contributions as part of a larger effort to help older workers in both the public and private sector get ready for retirement. In 2021, catch-up contributions are capped at $6,500.
Currently, in order to make catch-up contributions, participants must elect to make an additional allotment from their paychecks separate from their typical contributions. TSP officials have said the complexity of this system has led to some participants overcontributing to their traditional allotment and under-contributing to catch-up contributions.
Under the new system, participants’ traditional and catch-up contributions are covered by the same allotment. When eligible participants hit their annual cap on normal contributions, the TSP will automatically begin funneling the rest of their contributions into the catch-up contribution bucket.