Q. I am trying to decide whether to withdraw from my TSP account or take out a loan to purchase rental property. I am no longer employed with the federal government and I am 55 years old. What would your advice be?
A. I won’t give you advice since I’m not familiar with your circumstances, goals and preferences. Also, you should avoid taking advice from someone who’s not responsible for the outcome it produces. I will give you some things to consider in deciding what to do, though. If you separated from federal service before the calendar year in which you reached age 55, you’ll have to contend with the early withdrawal penalty. You should also carefully consider whether, or not, the rental property will better support your retirement income needs that than your TSP investment. If the cash flow from the real estate investment will cover the payments for a loan, I’d tend to favor that option. If it won’t, you may want to reconsider the idea, altogether.