Agency: "Federal Retirement Thrift Investment Board."
SUMMARY: The Federal Retirement Thrift Investment Board (FRTIB) is proposing to amend its regulations to increase the automatic enrollment percentage from 3 percent to 5 percent of basic pay for all participants who are automatically enrolled in the Thrift Savings Plan (TSP) on or after
DATES: Comments must be received on or before
ADDRESSES: You may submit comments using one of the following methods:
* Federal eRulemaking Portal:http://www.regulations.gov. Follow the instructions for submitting comments.
* Fax: (202) 942-1676.
* Mail or Hand Deliver/Courier:
FOR FURTHER INFORMATION CONTACT:
SUPPLEMENTARY INFORMATION: The FRTIB administers the Thrift Savings Plan (TSP), which was established by the Federal Employees' Retirement System Act of 1986 (FERSA), Public Law 99-335, 100 Stat. 514. The TSP provisions of FERSA are codified, as amended, largely at 5 U.S.C. 8351 and 8401-79. The TSP is a tax-deferred retirement savings plan for federal civilian employees and members of the uniformed services. The TSP is similar to cash or deferred arrangements established for private-sector employees under section 401(k) of the Internal Revenue Code (26 U.S.C. 401(k)).
The Thrift Savings Plan Enhancement Act of 2009 authorized the FRTIB to add an automatic enrollment program for all Federal employees eligible to participate in the TSP. The National Defense Authorization Act for Fiscal Year 2016 extended the automatic enrollment program, with an additional automatic re-enrollment feature, to certain members of the uniformed services. Under the automatic enrollment program, the Executive Director has the statutory authority to select a default contribution rate for automatically enrolled participants that is no less than 2 percent and no more than 5 percent of basic pay.
Currently, the following participants are automatically enrolled in the TSP at the statutory default rate of 3 percent: (1) Federal Employees Retirement System (FERS) participants hired or rehired after
The FRTIB proposes to increase the automatic enrollment rate and the automatic re-enrollment rate to 5 percent, effective
The TSP's goal is to help federal employees and members of the uniformed services retire with dignity. As of
Increasing the rate to 5 percent not only increases the amount that a participant saves from his or her basic pay, but also ensures that that participant receives the full amount of Agency/Service Matching Contributions he or she is entitled to, both of which will allow the participant, everything else being equal, to achieve significantly greater retirement savings.
Installment Payments Calculated Based on Life Expectancy
The FRTIB is proposing to amend its rule regarding installment payments calculated based on life expectancy to clarify that, for each year following the year in which the installment payments begin, the installment payment amount for the year will be calculated on the first installment payment date of that year.
Regulatory Flexibility Act
I certify that this regulation will not have a significant economic impact on a substantial number of small entities. This regulation will affect Federal employees, members of the uniformed services who participate in the TSP, and beneficiary participants.
Paperwork Reduction Act
I certify that these regulations do not require additional reporting under the criteria of the Paperwork Reduction Act.
Unfunded Mandates Reform Act of 1995
Pursuant to the Unfunded Mandates Reform Act of 1995, 2 U.S.C. 602, 632, 653, and 1501-1571, the effects of this regulation on state, local, and tribal governments and the private sector have been assessed. This regulation will not compel the expenditure in any one year of
List of Subjects
5 CFR Part 1600
Government employees, Pensions, Retirement.
5 CFR Part 1650
Alimony, Claims, Government employees, Pensions, Retirement.
Executive Director, Federal Retirement Thrift Investment Board.
For the reasons stated in the preamble, the FRTIB proposes to amend 5 CFR Chapter VI as follows:
PART 1600--EMPLOYEE CONTRIBUTION ELECTIONS, CONTRIBUTION ALLOCATIONS, AND AUTOMATIC ENROLLMENT PROGRAM
1. The authority citation will continue to read as follows:
Authority:5 U.S.C. 8351, 8432(a), 8432(b), 8432(c), 8432(j), 8432d, 8474(b)(5) and (c)(1), and 8440e.
PART 1650--METHODS OF WITHDRAWING FUNDS FROM THE THRIFT SAVINGS PLAN
4. The authority citation continues to read as follows:
Authority:5 U.S.C. 8351, 8432d, 8433, 8434, 8435, 8474(b)(5) and 8474(c)(1).
(a) * * *
(2) An installment payment amount calculated based on life expectancy. Payments based on life expectancy are determined using the factors set forth in the
CFR Part: "5 CFR Parts 1600 and 1650"
Citation: "85 FR 8767"
Federal Register Page Number: "8767"