Q. Please explain how much money you need to take out of TSP when you turn 70½. I heard that if you have $100,000 in there you need to take out $1,000 and if you have $200,000 in there it’s $8,000. Is there a table or guidance on this? I am trying to understand the process so I don’t get penalized with taxes.

A. The amount that you must draw from your TSP account after you are both: 1. Separated from federal service, and 2. Over age 70½ is called the Required Minimum Distribution, or “RMD.” This amount is calculated each year according to a formula that is based on your life expectancy and the balance in your account at the end of the previous year. This means that the RMD amount changes every year. Instructions for calculating the RMD are contained in publication TSP-775 at https://www.tsp.gov/PDF/formspubs/tsp-775.pdf. There are also calculators that will do the job for you available from reputable sources online.


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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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