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The TSP plans to change some of its long-used terminology, including by starting to call investments by account holders “investments” rather than “contributions.”

Proposed rules in the March 1 Federal Register link that change and others to new policies set to take effect in mid-year with the launch of a record-keeping system that among other things will allow for investments outside the TSP’s own fund offerings through a mutual fund “window.”


The TSP traditionally has called employee investments “contributions” even though that has caused some confusion since that term typically applies to giving away money rather than investing it. Instead, the term “contribution” will be reserved for money agencies put into accounts on behalf of FERS employees.

Also, the TSP will drop the term “interfund transfer” which traditionally has referred to an investor’s shift of money between investment funds. Instead, that type of movement will be called a “fund transfer.”

In addition: “rollover” will be used to rather than “transfer” in reference to movement into the TSP of money from another retirement savings plan; “post-employment distribution,” will be used rather than “post-employment withdrawal” for a distribution to a participant who has separated from government service; and “TSP withdrawal” will be used to refer to both a post-employment distribution and an in-service withdrawal.

The rules also describe several changes under the new records system designed to simplify and speed up rollovers, withdrawals, beneficiary designations and certain other transactions, while adding options for repaying loans ahead of schedule.

Also regarding loans, changes ahead include raising the minimum term for a residential loan from 12 to 61 months; no longer allowing such loans for the purchase of a boat or vehicle to be used as a primary residence; reducing from 60 to 30 days the period a participant must wait to take out a loan after paying one off; and eliminating the 12-month wait now required to take out a loan if a prior loan was not fully repaid on time.

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