Thrift Plan Law and Legal Definition

A thrift plan is an employer-sponsored plans that allow participants to contribute a portion of their after-tax pay to a trust fund via payroll deduction. It is a defined contribution plan to which employees make contributions on an after-tax basis, usually as a percentage of salary. Matching contributions may also be made on behalf of the participating employees by the employer.

The federal governement also has a thift savings plan (TSP), which is a retirement savings plan for civilians who are employed by the United States government and members of the uniformed services. The legislation providing for the Thrift Savings Plan (TSP) is included in the Federal Employees Retirement System Act. It is administered by the Federal Retirement Thrift Investment Board.