Timing Can Be Tricky

Those wishing to make catch-up contributions to the TSP can apply at any time; it is not necessary to wait until a TSP open season to do so. However, this year investors-especially those employed by DoD–will need to concentrate the investments in a relatively few pay periods; some already are saying they won’t be able to make the $2,000 maximum contribution because they can’t afford to have such a large amount taken out of so few pays. In addition, investors need to check with their payroll offices regarding when the deductions would start and when they would stop in order to designate the correct amount to be taken from each pay. Catch-up contribution elections are valid only through the end of the calendar year in which they are elected.