The investment limit on tax-favored retirement savings plans such as the TSP is rising to $19,000 from $18,500. That’s the cap on regular investments by employees, called the “elective deferral limit.”
For those making investments on a percentage of salary basis, investments will rise automatically with the pay raise—as will agency contributions, for those under FERS.
Those making investments based on a dollar amount per pay period might wish to consider increasing that amount, especially if they are under FERS and would not capture as much of a matching government contribution, which is based on a percentage of salary the employee invests. To get the maximum match, an employee must personally invest at least 5 percent of salary.
The separate limit on “catch-up contributions”—additional investments allowed for those age 50 or older at any time in calendar year 2019—will stay flat at $6,000. Those who made catch-up investments in 2018 must make a new election if they want to make them again in 2019; unlike regular investments, those don’t carry over from year to year.
The contributions limits apply to the total allowed for the year into similar programs—for example, a federal employee who also invests in a military TSP account during active military service, or an employee who leaves government and invests in a 401(k) plan of a private sector employer in the same year.
More on the TSP and the elective deferral limit at ask.FEDweek.com