Use TSP account to pay off mortgage?


Q. I owe $200,000 on my mortgage, and I would like to know if it would be smart to get a $20,000 loan from my TSP every 2.5 years until I pay off most of or all of my mortgage? I still have 15 years left before I retire, so I figured I could pay off my mortgage and my TSP loan before I retire.

A. I’m not sure I see any advantage to doing this. On one hand you’ll be paying yourself the interest instead of paying it to the bank, but on the other hand, you’ll be removing the money for the investment markets. There are pros and cons to the idea, but in the net, I don’t see any reason to characterize it as “smart.”


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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 and view his blog at

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