A tool designed for Thrift Savings Plan (TSP) participants helps project potential retirement savings by considering factors like current contributions, investment growth rates, and future contributions. For example, such a tool might allow users to input their current account balance, estimated annual contributions, and desired retirement age to estimate their potential savings at retirement.
These tools empower individuals to make informed decisions about their retirement planning. By visualizing the potential impact of different contribution levels and investment strategies, users can adjust their savings plan to better align with their retirement goals. Understanding the long-term growth potential of their contributions encourages responsible financial planning and provides a clearer picture of future financial security. This capability has become increasingly important in an era of defined-contribution retirement plans, where individuals bear greater responsibility for managing their own retirement savings.