New Bill Opens TSP Contributions for Veterans
Reps. Jen Kiggans (R-VA) and Wesley Bell (D-MO) on Monday introduced a new bill that would support veterans’ retirement savings.
The Financial Opportunities for Retirees and Warriors Advancing Retirement Development (FORWARD) Act would allow military and disabled veterans to continue contributing into a Thrift Savings Plan (TSP). Under federal law, service members can no longer contribute to a TSP once they depart from the military.
“For our 20-year retirees and veterans with a 100% disability rating, it’s only fair that they can keep contributing to the Thrift Savings Plan they’ve spent years building,” said Rep. Kiggans, who is also a former Navy pilot, in a statement. “They shouldn’t be forced to start over in a new system when they’ve already invested in one that works for them.”
According to text of the bill, the FORWARD Act would allow qualified retirees and veterans to make voluntary contributions from their retired pay of VA disability compensation. Qualified individuals include those who are entitled to military retirement pay, have received “VA disability compensation at a 100% disability rating,” and those who were enrolled in a TSP account while serving, stated the bill. It does not authorize the federal government to match retirement plan contributions.
The legislation directs the Federal Retirement Thrift Investment Board, working alongside the Department of Defense and the Department of Veterans Affairs, to implement this change within 180 days of its passage.
“Our veterans have earned the right to build a secure future using the retirement tools they know and trust,” said Rep. Bell. “Right now, retired service-members and disabled veterans are being forced off their existing plans the day they hang up the uniform. The FORWARD Act is a commonsense fix that removes that barrier, so they can continue planning for retirement in a plan they’ve relied on throughout their service to our nation.”
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Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with nearly a decade of experience and a passion for telling stories and reporting news. She is originally from Queens, New York, but now resides in Denver, Colorado.
