What is the automatic contribution and matching arrangement in the Blended Retirement System?

What is the automatic contribution and matching arrangement in the Blended Retirement System?

• A. 1% Automatically after 90 days forever; after two years your contribution is matched up to 5% (if you put in 4% it only matches to 3.5%)
• B. 1% Automatically after 90 days forever; after two years your contribution is matched up to 5% (if you put in 4% it matches to 3.5%)
• C. 2% Automatically after 90 days forever; after two years your contribution is matched up to 6%
• D. 0% Automatically after 90 days; no matching

Answer: (B)

The Blended Retirement System provides an automatic 1% contribution to your TSP after 90 days of service, and this automatic contribution continues thereafter. After you’ve served for two years, the government will match your own contributions up to 5% of your base pay, but the match is not a straight dollar-for-dollar or fixed percent of what you contribute. For example, contributing 4% of base pay results in a 3.5% government match, illustrating the non-linear structure and the cap at 5%. This is why the described arrangement is the best fit: it correctly states the 1% automatic contribution after 90 days and the 5% cap on the government match after two years, including the partial-match example. The other descriptions are inconsistent with the actual automatic and matching provisions (such as a different automatic percentage, or no matching).

The Blended Retirement System provides an automatic 1% contribution to your TSP after 90 days of service, and this automatic contribution continues thereafter. After you’ve served for two years, the government will match your own contributions up to 5% of your base pay, but the match is not a straight dollar-for-dollar or fixed percent of what you contribute. For example, contributing 4% of base pay results in a 3.5% government match, illustrating the non-linear structure and the cap at 5%.

This is why the described arrangement is the best fit: it correctly states the 1% automatic contribution after 90 days and the 5% cap on the government match after two years, including the partial-match example. The other descriptions are inconsistent with the actual automatic and matching provisions (such as a different automatic percentage, or no matching).