How Does the TSP Differ from the FERS Basic Annuity and the CSRS Annuity?
The Thrift Savings Plan (TSP) is a defined contribution
plan. The retirement income that you receive from your TSP
account will depend on how much you (and your agency, if you are a FERS
employee) have contributed to your account during your working years and the
earnings on those contributions.
The contributions that you make to your TSP account are voluntary and are
separate from your contributions to your FERS Basic Annuity or CSRS annuity.
In contrast to the TSP, the FERS Basic Annuity and the CSRS annuity
are defined benefit programs. This means that the benefits you
receive from your FERS or CSRS annuity are based on your years of service and
your salary, rather than on the amount of your contributions and earnings.
Most of the contributions to these annuity programs are made by your agency
on your behalf. Your contributions are mandatory and the amount you
contribute is defined by law. Your contributions are made by payroll
deductions that your agency takes automatically from your paycheck. The
FERS Basic Annuity and the CSRS annuity are administered by the Office of
On the other hand, your TSP contributions are voluntary, and in an
amount you choose. Your TSP benefits are in addition to your FERS or CSRS
annuity. If you are a FERS employee, the TSP is an integral part
of your retirement package, along with your FERS Basic Annuity and Social
Security. If you are a CSRS employee, the TSP is a supplement to your CSRS