Minority federal employees participating in the $240 billion Thrift Savings Plan, Washington, save less than other participants, according to a report by the U.S. Office of Personnel Management.
“Our findings indicate that while participation in TSP is generally high, minority groups are lagging behind non-minorities in terms of the percentage of employees participating, salary deferral rates, and TSP balances,” John Berry, director of the Office of Personnel Management, wrote in a letter to Sen. Herbert Kohl, D-Wis., that accompanied the report.
Mr. Kohl, chairman of the Senate Special Committee on Aging, had requested the report, which he made public Wednesday.
Examining federal employee participation in TSP in 2007, the latest year for which data were available, the analysis revealed that minorities “are generally less likely to participate — 82.5% vs. 87.8% of non-minorities — and, on average, have been a part of TSP for a shorter period of time — 8.8 years vs. 10.1 years,” the report said.
There was no significant difference in average length of service between the two groups, according to the report, suggesting that “minorities may take longer after entering the federal service to begin deferments.”
Among active participants, minorities contributed an average of $5,564 in 2007, about 25% less than non-minorities, who contribute an average of $7,470. The average deferral rate for minorities of 8.1% trailed the non-minority rate of 9.8%, the report said.
By the end of 2007, the average TSP account balance among minorities was $54,430, or about 33% less than the average balance for non-minorities of $81,152.
The report defined a minority as any race or ethnicity other than non-Hispanic white.
