Monthly Archives: August, 2010

TSP and Treasury Bills

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Q. How much public debt (Treasury Bills) does the Thrift Savings Plan have in it’s investment portfolio? A. I’m not sure I understand the question. What portfolio? If you’re referring to the total amount of TSP money invested by participants in Treasury Bills, I have no idea, nor do I care to spend the time to find out. If you mean your own TSP account, I’d estimate the amount to be somewhere between 10 percent and 20 percent of your F Fund holdings.

TSP and passwords

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Q. How often must a TSP password be changed?  I cannot find the answer on the TSP site. A. This is not a financial planning or retirement question and it should be posed directly to the TSP.

TSP withdrawal

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Q. I am a federal worker, 51 years of age and am considering a withdrawal from my TSP account to pay off my substantial consolidated college student loans. If I pursue this plan what will be the tax ramifications  or any other penalties?  Another option for me is to take a loan out from my TSP account to pay the loans off and then begin to make payments back to the account. Is interest charged on these type of loans? Are penalties involved or any type of tax implications?  If I do not pay all the “loan” back before retirement,…

TSP rollover

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Q: I will be retiring at the end of March 2011. I plan to roll over my TSP to an IRA. Can I roll it over before I retire? If not, how long does it takes to roll over to an IRA after I submit the form? A: If you have reached 59 1/2 and have not already done so, you may take an in-service withdrawal and roll it over to an IRA. Otherwise, you will have to wait until you retire to roll over your account. I can’t tell you exactly how long the process will take, but I…

TSP withdrawal

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Q: I turn 56 in December and I am retiring from the federal government. I would like to take the lump sum out of my TSP to buy a house. If I wait until my separation date of Dec. 7, I won’t get paid until January 2011. The Bush tax cuts expire at the end of December this year. Can I cash out my TSP a few months before to my last day without penalty because the cash out and retirement are in the same year and only a few months apart? Or must I wait until my actual separation…

TSP withdrawal

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Q: I just got discharged from the Navy. I was told to look online to find out how to move my money out of TSP but I’m having trouble finding this information. A: Visit www.tsp.gov.

Required TSP withdrawl at 70

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Q: I retired from federal service on Jan. 3, 2008. With accumulated sick leave I had about 42 years of service. I was 67 years old when I retired. I had been investing in TSP on a regular basis. When I retired I left my funds in TSP. I will turn 70 on Sept. 12. Am I required to withdraw the funds when I turn 70? I have heard from a financial adviser group that former federal employees with TSP must move their funds into either a lump sum withdrawl or an annuity when they reach 70. Is this true?…

Maximizing TSP matching

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Q: I contribute to TSP. I am a little confused about the maximum amount per year. It’s $16,500 for 2010. I contribute 15 percent to TSP and have been doing so for some time. My understanding is that I should have been doing the math and updating my TSP deposit amount over 26 pay periods of the year. I have not done this for a while but want to get back on track. My problem is that I’m not sure how to maximize. Is it as easy as dividing 16,500 by 26 pay periods? I don’t understand what that would…

Irrational behaviors investors should avoid

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Experience and research show that investors consistently act irrationally in managing their investments — buying and selling the wrong things at the wrong times and for the wrong reasons. For the young investor, the cost of these mistakes will never be known, since there is rarely a clearly defined goal against which to measure performance. But, for retired investors, the mistakes can be painfully costly since they can result in unexpected, and unpleasant, changes in lifestyle. It would be interesting to see how different your investment decisions regarding your Thrift Savings Plan account might be if you had make-or-break performance…

TSP

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Q. I am under the FERS program.  Is the matching fund from the government included in my TSP balance now or will it be added when I retire? A. It’s being deposited as you go.

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