- The Washington Times - Tuesday, December 24, 2002

If you've accumulated several 401(k) or other retirement accounts during your career and want a super-safe place to consolidate them, then consider the federal Thrift Savings Plan.
The only catch: You must work for the federal government, the postal service or be a member of the uniformed services.
How good and safe is the federal 401(k) plan? Consider this: Investors have moved $200 million in "outside" money into the TSP since transfers were first allowed in January. One fed moved $1 million into the TSP. Now, that's a vote of confidence.
What's the magic of the federal 401(k) plan? Well, consider that it's probably the most regulated 401(k) plan in the nation; its participants include members of Congress, as well as top career employees of the Treasury Department, the Securities and Exchange Commission, the FBI, and the Office of Management and Budget.
In addition to the TSP's don't-tread-on-me client list, it has another unique feature: The G (as in Good as Gold) fund. The G-fund is made up of special guaranteed U.S. Treasury securities that are not available to other Americans.
The other TSP funds rise and fall with the markets. But the G-fund keeps chugging along.
Over the past 12 months, the G-fund returned 5.04 percent, keeping well ahead of inflation. Meanwhile, the indexed funds lost 10 to 16 percent.
Only the F-fund (bond index) did better, earning 7.36 percent. But it, too, is subject to inflation and other factors that don't touch the G-fund.
The open season, when eligible federal-military personnel can sign up for the TSP or reallocate funds, ends Dec. 31. During this open season, workers can elect to have more money taken out of their paychecks next year to take advantage of higher-percentage investments (8 percent for feds under the old CSRS retirement system and for military personnel, and 13 percent for the majority of investors who are under the new FERS retirement system).
The amount anyone can invest in a 401(k) plan next year goes up to $12,000.
What's your TSP balance?
Most people with 401(k) plan accounts have seen them drop sharply during the past two years. People who were heavily invested in stock funds have been hit especially hard.
But even with the drop in the stock market, on average, feds hired after 1983 have TSP account balances of just more than $44,000. The typical account balance for workers under the CSRS system (who don't qualify for matching contributions) is just a little more than $30,000.
The catch to long-term care
Many federal military retirees trying to sign up for the federal long-term-care insurance plan are discovering that there's a catch.
If you need it, you can't get it. That is, if you have a disease or medical condition, such as Alzheimer's or Parkinson's disease. Nor could you qualify for or afford an individual policy from an outside firm.
That's tragic for them, but it's a good reason for healthy, younger feds (who typically don't think about nursing homes) to check out the federal LTC program. If nothing else, use it to compare coverage and premiums with a private company.
You can check out the Office of Personnel Management Web site www.opm.gov/insure/ltc/index.htm. Or you can call OPM for help (8 a.m. to midnight) daily at 800/582-3337.

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