Rise in Investment Limits Moving Up

The change in the TSP open season schedule means that the next one percentage point increase in the allowable percentage of investments will occur a month earlier. Effective with the first pay period beginning on or after December 1, investors in the FERS retirement system will be able to invest 13 percent of biweekly salary while those in the CSRS system will be able to invest 8 percent. Those changes can be requested at the start of an open season but there is a lag time between the request and the effective dates; had the fall open season date not been advanced to October 15, the effective date would have been the first pay period beginning on or after January 1. The TSP percentage of salary investment limits are being phased out under a law passed in 2000. Regardless of the percentage limits, investors are capped by a tax code dollar limit ($11,000 this year, $12,000 in 2003) that as a practical matter may set a lower limit, depending on salary.