Maximum TSP contributions

[PureGains]

So I read that 731 is the maximum TSP contributions and will reach the 19000 limit over 26 pay periods. Does the 19000 cap include the agency's matching payments or you can only deposit 19000 of your personal paycheck cash and anything the agency contributes is just a bonus? I hope the question is clear.

[roxy13]

No it does not include agency match just your contributions. So yes the match is a bonus.

[PureGains]

Thank you!

[mmmmmbeer]

Yup... you put in 731... and then they match it. So I end up getting a littlenover $1k contributed per PP.

[mmiller17]

What happens if you go a little over the 19000. Do they stop withdrawing or do you just pay tax?

[Sky5HD]

What happens if you go a little over the 19000. Do they stop withdrawing or do you just pay tax?

Yes, they stop contributions. That's why it's very important not to exceed the limit early, because you will also lose agency matching once you reach the limit.

[PhilJohn]

I was actually wondering, what happens if you max your contributions a month or two early. Does it really matter?

[mmmmmbeer]

I was actually wondering, what happens if you max your contributions a month or two early. Does it really matter?

No match... no matter how much you put in... you only get a 5% match per pay period. So... if you max out the 19000 prior to your last few checks... no tsp contribution those checks... no 5% match.

[fordest]

I used to do this. It was hard the first couple years that I maxed out my TSP. Had to live on less, but it was worth it for my retirement. And I liked doing it early. When those last couple checks in December were bigger because I had already maxed out my TSP came in I thought it was fantastic. "Woohoo rolling in the money this month!" I thought. Then I learned that I was missing out on the matching... Throwing away free money.... put a stop to that right away. No more maxing out early. The best of both worlds would be to calculate it so that your last contribution maxes you out and comes in at exactly 5%. But that is too much work and too much math, and I would second doubt myself to the point of anxiety.

[PhilJohn]

Ahh. I didn’t even think of that. Well I’m way ahead for this year so I’d better make an adjustment. Thanks guys.

[bamablue]

In addition to your $19K annual cap and matching contributions, there is a TSP Catch-up for persons age 50 or older. This is another (up to) $6K annually you can contribute to TSP...

If you can afford to part with the money, this catch-up is a great deal, because it does not count toward your $19K contribution limit.

[mjedlin66]

In addition to your $19K annual cap and matching contributions, there is a TSP Catch-up for persons age 50 or older. This is another (up to) $6K annually you can contribute to TSP...

If you can afford to part with the money, this catch-up is a great deal, because it does not count toward your $19K contribution limit.

But you have to specifically elect "catch-up" contributions via Payroll. Don't just throw the extra 6k into your regular contributions!!!

[nodak]

No more maxing out early. The best of both worlds would be to calculate it so that your last contribution maxes you out and comes in at exactly 5%. But that is too much work and too much math, and I would second doubt myself to the point of anxiety.

This should not be difficult or too much work at all, unless somehow your agency does things really different than mine.

Any year there is a change to the number of pay periods and/or an increase to the max, I go to the payroll website and it shows how much I need to contribute. This year for example was $731 a PP and the last (26th) PP will automatically round down to $725 so as to hit $19k exactly. Last year - 27 PP’s, $686 with the last being $664 =$18,500. And to be clear, the reduction in the last PP is done without any input by you.

How are you doing it now?

[mattch45]

The best of both worlds would be to calculate it so that your last contribution maxes you out and comes in at exactly 5%. But that is too much work and too much math, and I would second doubt myself to the point of anxiety.

Don't you just need to take 5% of your annual salary, subtract that from the annual contribution limit, and that's how much you can pay early?

For example, say you make $100,000. Your 5% match is $5,000 annually or $192.31 per pay period. For maximum benefit, you would want to pay in $14,000 ASAP. (Every pay period that passes, you add $192.31 to that amount.) After that, you continue your $192.31 payments until year end for maximum match.

[ProduceMan]

The best of both worlds would be to calculate it so that your last contribution maxes you out and comes in at exactly 5%. But that is too much work and too much math, and I would second doubt myself to the point of anxiety.

Don't you just need to take 5% of your annual salary, subtract that from the annual contribution limit, and that's how much you can pay early?

For example, say you make $100,000. Your 5% match is $5,000 annually or $192.31 per pay period. For maximum benefit, you would want to pay in $14,000 ASAP. (Every pay period that passes, you add $192.31 to that amount.) After that, you continue your $192.31 payments until year end for maximum match.

That’s pretty cool, never looked at it that way. Pay the most you can
(max contribution) - (5% annual pay) then once that is reached only contribute 5% of pay. Think I got it right. Contribute more first, then sit back and let “compounding take over”.