TSPs usually allow military and civilian employees to build retirement income through automatic payroll deductions. However, investors could only contribute a maximum of 10 percent of their basic pay. With the elimination of the percentage cap, TSP investors can invest as much as 100 percent of their basic pay.

This voluntary plan is similar to a 401(k) plan for civilians, with a few added benefits. TSP contributions are tax-deferred, not to mention, the contributions are withdrawn before taxes are withheld.

"TSP is a long-term retirement savings plan, which everyone should consider," says Janet Thomas, a human resources specialist, in a published report.

To maximize this benefit military members or civilians should invest early in this retirement account.

"As with any individual retirement account, the sooner you begin contributing, the better," Thomas adds.

For more information about TSP contributions, visit the Military.com Banking and Savings Center.

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