Q. Is it ever possible to roll your buyout dollars into your Thrift Savings Plan? If so, how would that be done? A. No.
Author Mike Miles
Mike Miles
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.
Buyouts. Career feds anywhere near retirement eligibility can rival Indiana Jones in their determination, skill and daring in hunting this treasure. But, in reality, buyout offers are more like “Let’s Make A Deal” than “Raiders of the Lost Ark.” This game show is actually instructive in some of the fundamentals of probability and decision-making. In playing the game, contestants face a series of decisions in which they must choose to keep or trade a “bird-in-the-hand” for another prize hidden behind a curtain or in a box — a “bird-in-the-bush.” When you are offered the opportunity to retire with incentives, like cash,…
Q. I have 26 years of Defense Department service with a target of six years to go before retiring. The Federal Employees Retirement System isn’t doing very well with the Thrift Savings Plan Offset. Because of a failing market, I have missed my TSP target by a large sum. Does the government have any plans to assist the FERS employees looking to retire with a failed TSP? Most FERS employees are having to work past their target because they can’t afford to retire. The Civil Service Retirement System is much better. Combining FERS, TSP and Social Security, we still fall short compared…
Q. I am currently employed with 10 years service accrued in the Federal Employee Retirement System. If I were separated/left federal employment for the private sector, would I be allowed to roll over the entire contents of my 401(k) account (acquired via my new employment) into my Thrift Savings Plan? Similarly, if I were to retire from federal employment, would I be allowed to roll over the entire contents of any 401(k) account(s) (acquired as a result of any previous private-sector employment) into my TSP? A. As long as you maintain your TSP account, whether employed, separated or retired from federal…
Q. I retired in 2007 and am in the Civil Service Retirement System. Am I permitted to continue to contribute monthly to my Thrift Savings Program? May I roll over the entire contents of my Individual Retirement Account into TSP? Can I then make monthly contributions into TSP from my checking account? A. You may not contribute to the TSP after you retire, but you may transfer eligible IRA balances into the TSP at any time. To be eligible, the IRA must contain only pretax money.
Q. I am considering taking an early retirement offer. If I were to have another financial institution purchase an annuity that is offering a better interest rate than what MetLife is offering through the Thrift Savings Plan and do so directly so that it would not be deposited to a personal checking or savings account, would it be exempt from tax penalties because I am under 59½, even though it would be taxed as regular income through the payments from the annuity provider as it would if TSP purchased the annuity for me? A. Yes. You may roll TSP money…
Q. I am a retired federal worker. I am in the Federal Employees Retirement System, a Thrift Savings Program participant, and, because I am over 70½ years old, I have been taking my Required Minimum Distribution in the form of monthly payments based on my life expectancy. I also have a traditional Individual Retirement Account with my local bank. I also have a Roth IRA at this bank. I want to consolidate some of my funds and increase my monthly payments by transferring my traditional IRA to my TSP account. I was told by the bank that the time for…
Q. Will TSP participants who have (or take out) a loan be able to make the repayments into the Roth portion of their TSP once the Roth option is established? A. The rules have not been published, yet.
Q. Will I be able to open a TSP Roth account and then roll my current Janus Roth IRA balance into it? How about after retirement? I have waited patiently for the promising TSP Roth, but it has been delayed time and again. Now it’s set for rollout in the second quarter of 2012. How nice: I’m planning to retire by the end of April, meaning that I may be ineligible for the TSP Roth if it is not offered by then. If the TSP Roth begins in May, June, or afterwards, am I out of luck? Since I plan…
Q. I will be retiring from the the Postal Service with 31 years of FERS at the age of 56. I know I will be eligible for the Social Security supplement until I reach the age of 62. My question is about earning limits with the supplement. If at age 56, I withdraw all or a portion of my TSP account, will this affect my Social Security supplement from the Postal Service? A. TSP withdrawals are not counted as earned income.