How does the FERS matching formula work?

Your employing agency establishes TSP account and makes an automatic contribution equal to 1 percent of salary, whether or not you invest your own money. For FERS employees who do invest their own money, investments are matched dollar for dollar for the first 3 percent of pay invested per pay period, and then 50 cents on the dollar for the next 2 percent of pay invested per pay period. Thus the maximum government contribution for FERS employees is equal to 5 percent of salary.

For those newly hired, automatic contributions begin immediately and matching contributions begin when you start investing personal money. That also happens immediately by default unless you opt out. Those matching contributions continue as long as you are personally investing.

For those investing in both tradition and Roth-type balances, the amounts are combined for purposes of determining the matching amount.

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