The new year has brought some changes regarding your federal benefits. Keeping up with these changes will help you maximize your benefits and better prepare for retirement.
TSP Contributions
TSP contribution limits for 2025 have been increased. This applies to both traditional and Roth TSP accounts. Here’s a breakdown of the new limits:
Under Age 50 – $23,500
Age 50 and Up – $31,000 = $23,500 plus $7,500 in catch-up contributions
Age 60-63 – $34,750 = $23,500 plus $11,250 in catch-up contributions
Even if you’re not in a position to hit the maximum contribution limit, be sure that you’re investing at least 5% in your TSP to get the full agency match.
Benefit Premiums
Premiums for the Federal Employee Health Benefits program (FEHB) saw a significant increase this year – 13.5% to be exact. This is far steeper than the 7.7% and 8.7% increases experienced in 2024 and 2023 respectively. However, the government still pays around 70% of your premium. Increases to FEDVIP dental plans (2.97%) and vision plans (0.87%) were much lower.
Flexible Spending Accounts (FSAs)
Contribution limits for FSAs will see an increase from $3,200 to $3,300. Keep in mind that you can only roll over $660 of unused funds in 2025. Be sure to use the money you contribute to cover qualified out-of-pocket medical and health expenses or you could end up losing it.
Health Savings Accounts (HSA)
For 2025, contribution limits for your HSA are $4,300 for individual coverage and $8,550 for family coverage. An additional $1,000 catch-up contribution is allowed for participants who are 55 or older. HSAs have no limit on the amount of unused funds you can roll over. Another benefit of an HSA is it allows you to invest the funds you have contributed to help grow your balance.
Cost Of Living Adjustments (COLA) for FERS Retirees
FERS retirees will receive a 2% COLA for 2025. This will result in a 2% increase in your annuity. COLAs are not provided until age 62, except for disability, survivor benefits, and other special provision retirements.
Understanding your benefits is key to making sure they work hard for you. Speaking with a certified Federal Retirement Consultant® can help you maximize your unique federal benefits, establish a TSP investment strategy, and set you on the path to a successful retirement.
