Participants in the Thrift Savings Plan will soon see a few changes coming to their retirement savings accounts, according to the Federal Retirement Thrift Investment Board.

During a TSP board meeting last week, FRTIB officials outlined a few recent changes that have already taken place for participants — as well as a few updates that are expected to take place in the near future.

Here are four important changes TSP participants should look out for.

TSP “I” fund’s new index now in place

The TSP’s international — or “I” fund — has officially transitioned from the “MSCI Europe, Australasia and Far East” benchmark index, to the “MSCI All Country World ex USA ex China ex Hong Kong Investable Market” benchmark index.

“What that change does for our participants is it moves from EAFE, which was about 55% of non-U.S. market capitalization, to 90% of non-U.S. market capitalization,” FRTIB Director of External Affairs Kim Weaver said in an interview. “It really broadens the exposure in the I fund for our participants.”

The update to the I fund’s benchmark index comes after the TSP board members voted in November 2023 in favor of changing the index. The transition to the new I fund index took full effect on Oct. 30.

The adjustment from one index to another significantly expands the investment portfolio for TSP participants, more than doubling the number of countries included in the I fund. The exclusion of China and Hong Kong stems from possible market volatility among unforeseen events, such as investment restrictions on Chinese technology sectors.

“Our investment consultant pointed out to us that given the restrictions on certainty Chinese technology, certain listings of Chinese companies on the U.S. stock exchange and sanctions on Russian securities, the operational complexity of international investment has increased,” Weaver said. “They recommended moving to this index to try and insulate our participants from that operational uncertainty and complexity.”

Catch-up contribution limits increasing in January

Starting in 2025, TSP participants will be able to contribute slightly more to their TSP accounts, according to the new 401(k) limits the IRS announced in early November.

The new contribution limit for 2025 will $23,500 for many, but not all, TSP participants, as well as other individuals enrolled in their employers’ 401(k) programs.

Some TSP participants, however, will be able to contribute even more toward their TSP accounts beginning in 2025.

Participants ages 50 and older will be able to make additional catch-up contributions of up to $7,500, totaling to $31,000 in maximum contributions for 2025.

TSP participants between the ages of 60 and 63 will have an even higher catch-up contribution limit of $11,250 — totaling $34,750 for their maximum contribution. Once participants turn 64, their catch-up contribution limit will return to the standard limit for those ages 50 and up.

The changes in the limits for catch-up contributions stem from the SECURE 2.0 Act, which Congress passed in 2022.

Participants can use the contribution calculator on the TSP’s website to determine how much they should contribute per paycheck if they are looking to meet, but not exceed, the contribution limit by the end of the year. FRTIB updated the calculator with the latest information from the IRS earlier this month.

Roth in-plan conversions coming to TSP in 2026

Throughout 2025, the FRTIB will also be ramping up its preparations to launch another new feature for TSP participants the following year.

The board plans to initiate a new Roth in-plan conversion option for TSP participants. Once the new feature becomes available in January 2026, participants will be able to convert any or all of their pre-tax assets into Roth assets.

“But of course, that means that there’s a tax bill due,” Weaver said. “The important thing for people to realize is they have to pay that tax bill with money from outside the TSP.”

Weaver said the board’s preparations for launching the new Roth in-plan conversion feature will take place over the next year. The preparations include rewriting TSP communications materials, as well as putting together new information for the TSP website.

“All of that takes time,” Weaver said. “And then, more importantly, is testing the computer system so that when participants make that Roth in-plan conversion, we generate the right tax information for the IRS.”

In part, the new feature comes after a number of TSP participants expressed interest in having a Roth in-plan conversion option added to the program. In the most recent TSP participant satisfaction survey, 35% of respondents who were aware of Roth in-plan conversions said they would be either “likely” or “extremely likely” to use a conversion feature if it was available.

Statement delivery options available to participants

To review their TSP account statements, participants will also soon be able to choose their preference of either receiving their statements electronically, or through the U.S. mail.

The FRTIB said it plans to email all TSP participants who have an email address on file, each time there is a new quarterly or annual statement available. For security purposes, participants have to log into the My Account platform to actually access and view their statements.

Those who are interested in making changes to the notification method, such as switching their notifications to snail mail, can change their preferences once they are logged into My Account by selecting “Manage Communications” on their account profile.

“We are going to allow participants to truly choose their preference for either mail, or having things emailed,” Weaver said. “We will be sending a letter to every participant for whom we have an email address, and we will be letting them know that they can choose their preference.”

Participants should expect to receive a notice from the FRTIB in the coming weeks about the notification changes for their account statements.

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