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The form applies only to the disposition of your Thrift Savings Plan (TSP) account after your death. It is only necessary to designate a beneficiary if you want payment to be made in a way other than the following order of precedence:
In this order of precedence, a child includes a natural child and an adopted child, but does not include a stepchild whom you have not adopted; parent does not include a stepparent, unless your stepparent has adopted you. By representation means that if one of your children dies before you do, that childs share will be divided equally among his or her children.
The statement above was extracted from the TSP-3 form. Be sure to read the full instructions on that form before submitting a Designation of Beneficiary to the TSP.