|TSP Balance||# of Members|
|$0.01 to $50,000||2,800,000|
|$50,001 to $24,9000||1,400,000|
|$25,000 to $499,000||371,000|
|$500,000 to $749000||92,000|
|$750,000 to $999,000||19,000|
|$1,000,000 to $4,700,000||3,300|
You can see there are only 3,300 members that are sitting pretty with a cool million in TSP, with one member worth $4.7 million dollars! If you are thinking of taking the BRS you better get educated in how the 5 funds work and how to balance them. The best line from the article is: “People who don’t invest at least five percent to get that match are walking away from the equivalent of a five percent, tax-deferred pay raise each year”. No half mesures here, if you go BRS then you must do 5% into TSP for match.
If you want to do spectacular things in retirement, including giving in spectacular ways, then TSP match with BRS is the way to go. Depending solely on that one pension check of 2.5% per year served without any match gives you less flexibility than 2.0% per year served with a pile of matched money in TSP in BSR. The other line from the article is : “The TSP isn’t a luxury. It is a must.”
A lot of the backlash on the new system focuses too much on the 20% loss in pension rather than the 5% match right now. Certainly there is a lot more work in BRS, but if you are up for it you will be handsomely rewarded. Now if you are set in the idea that you couldn’t ever properly invest the money, then stick with the old retirement and don’t worry about it.
Are you up for the BRS challenge?