Avoiding early withdrawal penalty


Q. I am 56 years old and I work for the Department of Justice. I expect to retire in the next year under CSRS.   I have approximately $300,000 in the Thrift Savings Plan. I would like to withdraw $100,000 when I retire at age 57 to pay off a mortgage, and keep the remaining funds in TSP until I am 70. Is there any way to withdraw $100,000 before I am 59½ without sustaining a tax penalty?

A. Yes. If you separate from service during or after the calendar year in which you reach age 55, your TSP withdrawals will be exempted from the early withdrawal penalty.


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Mike Miles is a Certified Financial Planner licensee and principal adviser for Variplan LLC, an independent fiduciary in Vienna, Virginia. Email your financial questions to fedexperts@federaltimes.com and view his blog at money.federaltimes.com.

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