How Good is TSP–the Federal Employee Retirement Plan?

Huffington Post
March 3, 2016

In a recent article, Helaine Olen found something good in Marco Rubio’s campaign: his advocacy that employees without workplace retirement plans be allowed to join the federal employees Thrift Savings Plan.

A former financial advice columnist, Olen in her wonderful book Pound Foolish revealingly exposed the hucksters of the financial self-help industry. They make their money, and lots of it, not from following their own financial advice but rather by telling others what to do. When the wary Olen is impressed by a financial plan, such as TSP, it says something.

What impressed her most was that TSP charged very low administrative fees of only .029 percent of account balances, much lower than other 401(k)-type plans like it which charge as much as 2% or 69 times more and thus take much more out of savings accumulations and future retirement income. It was, in her estimation, a model plan that should be accessible to more than federal employees.

The Rubio campaign, for its part, seems to have backed off on the proposal, probably because of opposition from the financial services industry’s Investment Company Institute and the Republican-affiliated Heritage Foundation.

But is TSP that good?

To continue reading, click How Good is TSP?

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