Q. What is the difference between a Roth TSP and a Traditional TSP? I was listening to a person yesterday and she says to place your funds in a Roth TSP so you don’t suffer the penalty at withdrawal. The only problem, she says, is you have to leave them in the Roth TSP for five years. Please clarify.
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.
Q. I am 48 years old and I want to get better gains on my retirement funds. I wanted to invest a percentage in the F fund and C fund. I’m not sure of the percentages and how good of a time it is to invest. Please advise.
Q. I am a federal employee (6+ years of service) making contributions into a TSP account. I plan on retiring from government service in December 2020. I also have funds in other IRAs. This year I turn 70 ½ years old. Can I still make contributions into my TSP account while I receive required minimum distribution money? Can I take in-service distribution not RMDs?
Q. I will be 58 years old on Nov. 9, 2018. I retired from government service in December 2017 after 30 years and 4 months of service. I at 57 and have heard that I can possibly begin withdrawals without a 10 percent tax penalty due to this fact. I need verification of this, and I also need a wise withdrawal strategy to make my TSP money last the life of my current retirement, although I plan to try to go back to work maybe part-time by Spring 2019.
Q. What would be the affect of putting 20 percent of TSP into each lifecycle fund? It seems very diverse, but then it doesn’t.
Q. I was recently hired as a GS employee and have a good amount of prior military time. I am in the process of saving up for the military buyback. I have money in a an IRA which I am no longer putting funds, due in part to the fact I am investing heavily in my TSP. Can I use the money in my IRA towards my military buyback?
Q. I currently have my TSP setup as a Roth account and I’m debating the MRA+10 option for retirement. If I take the early retirement option can I withdraw from my TSP or do I have to wait until I’m 59½ to avoid the penalty?
Q. I’m a 44-year-old federal employee with 20 years of service and hopes of retirement at age 62. This means 17 more years of TSP contribution and growth opportunity. I’ve been using the “How much will my savings grow?” calculator for several years now and I attempt to capture a best, medium and worst-case scenario when it comes to the percentages of expected annual rate of return and expected annual pay increase. From a financial advisor perspective, what would you consider a safe range of annual rate of return for TSP growth?
Q. I work for the U.S. Postal Service, but haven’t been there very long. I will be 65 this year and will probably only work for another year or so. Even though my time with the Postal Service has been short, will FERS, TSP and other retirement benefits be available to me as a 20- to 30-year career person? If so, what would be available, and how would I go about getting each of these started?
Q. I am separating from the U.S. Postal Service at age 58. If I take monthly payments of $1,400, will I still be taxed?