Any benefit or product related to the federal government is a popular target for scam-artists and perfectly-legal-but-not-quite-ethical companies to try to take advantage of people. The Thrift Savings Plan (TSP) is a great example: there are plenty of bad people out there trying to separate you from your hard-earned money.
Bogus Email, Websites, and AppsCriminals may use a variety of means to get account of your TSP account information. This may include phishing emails, fake websites, and non-secure apps. Be vigilant about providing your account information to anyone, and especially wary of anyone claiming to represent the TSP.
Most TSP contact will occur by mail. It will always include your account number on the correspondence.
The TSP will only contact you by email to confirm an web-based transaction, or to send information only emails. They will never ask for your account information via email.
The TSP will only contact you by telephone in response to contact from you.
Mis-represented RolloversScam artists have been targeting TSP account holders, particularly those nearing retirement, and encouraging them to roll their TSP funds into more expensive, less secure investment products. These companies often use names and/or logos that suggest that they are affiliated with the federal government.
Be skeptical of any person or company who contacts you about alternatives to your current TSP investments. If their offering interests you, research thoroughly and get independent, professional advice to explain the new product and how it differs from the TSP.
Under-Value Annuity BuyoutsTSP values can be converted into annuities, providing a lifetime stream of income. There are companies that will purchase an annuity for cash. This is legal and can even be legitimate, but it can be hard for the average consumer to know the true value of their annuity. This becomes a scam when the amount paid is significantly less than the value of the annuity, or there are inappropriate or excessive fees or charges that go with the exchange.
In generally, selling an annuity for a cash payout is a bad idea. There may be very specific, unique situations in which it is appropriate, but please consult with an experienced, independent professional to evaluate and explain your options before taking any action.
Your TSP value may be one of the biggest and most important of your investments. Don't let scam artists and self-serving investment advisers separate your money from you.