Q: I have a question regarding borrowing against TSP and would like your opinion on the scenario as to whether it would be worth borrowing against TSP.
I am 52 and have eight years as a FERS employee and I intend to do 12 more years for a total of 20 years before I retire. Currently, I contribute approx $600/pay period into TSP which currently totals to approx $100,000. I have about $20,000 in loans. My questions is: would it be sensible to borrow $20,000 against my TSP to pay off the loans? Or should I leave my TSP alone? I intend to continue contributing $600/pay period into my TSP account and set an allotment of $250/pay period for loan repayment. I estimate the loan to be repaid in approx 38-40 months.
A: You’re asking for specific, personal advice, which is beyond the scope of this forum. The answer to your question will depend upon your circumstances, goals and the assumptions used in the analysis.
