Q. I plan on retiring in five months. Can I take a partial withdrawal from my account and have it paid in monthly installments, or do I have to utilize the entire account to receive monthly payments?
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. In 2012, I began an affiliation with an Edward Jones agent who immediately whipped out the form to transfer my sizable TSP account to an Edward Jones investment account. Last year, I transferred all that account to Fisher Investments, which uses Merrill Lynch as my fund’s custodian. I spoke with a Fisher representative about transferring the IRA portion of my Fisher account back to the TSP. I told the rep that I liked the low investment fee of TSP, but he gave me every reason that TSP was not as good as a full-time manager of my account. He…
Q. I just heard a presentation on a Nationwide indexed annuity and was impressed by the historical returns, insurance company, no annual loss guaranty and right of survivorship. How might I decide if an indexed annuity is the right choice for some of my TSP funds? How might I fund an external annuity with TSP funds? I’m a 63-year-old enrolled in FERS with nearly 30 years of federal service, and I am looking forward to retiring in the next couple of years.
Q. Is it possible that folks’ G Fund in the TSP could literally dissolve/evaporate if the U.S. government “defaults” next week? I believe it’s possible, and, in a game of chicken, no one would care if federal employees took a hit like this. In fact, some may take relish in the political opportunity to blame the opposition for gain.
Q. I am not a government employee with almost eight years of civil service completed, and 100 percent of what I invest goes into the G Fund. I’m 37 years old. I started investing later, so I am behind, with a current balance of $11,000. Which fund should I have my money going into? I don’t want to work until I’m 70 because I failed to invest properly. I want to see my money grow so that when I do retire, I am comfortable.
Q. I have a TSP account. A portion of it is tax-exempt combat pay. When I was in combat, TSP didn’t offer Roth IRAs and, therefore, the money was combined into one account. However, the statement reflects how much of the pay is tax-exempt. I’m considering rolling over my accounts to have more options. TSP told me that they would have to send me a check for the tax-exempt portion and that they can roll the rest into a IRA. If they send me the tax-exempt money, can I deposit it into a Roth?
Q. I am about to take a demotion from a full-time, year-round position at the GS-08 pay grade to a 13/13 (six-months-on/six-months-off) permanent seasonal position at the GS-04 pay grade, effectively cutting my annual salary by 70% (not counting what I will get from unemployment during the times when I am laid off). I own my home, but still owe approximately $85,000 on it. Due to the downturn in the housing market, where I was once 30% or so paid off, my loan is now hovering right around 95-100% of my home’s current loan value. I have a fairly substantial…
Q. I am a 54-year-old federal worker with a sizeable TSP account balance. My 26-year-old daughter, also a federal worker, invests regularly in the TSP. If I leave my daughter my TSP after I die, is she allowed to transfer the inherited portion of the TSP into her own TSP account? If so, is the inherited TSP money treated the same as her TSP contributions? If not, how so?
Did you know that a war is being waged over your TSP account? Well, it’s true. Actually, this war is being fought over all employer-sponsored retirement plan accounts. Since the TSP is the largest such plan in the United States, I think it’s fair to single it out as the object of this war – at least for the purpose of this column. My purpose aside, I am pretty confident that, given the size of the TSP, and the profits that it could generate if its contents were turned over to the retail investment industry, this war would be waged…
Q. I am 66 and plan to retire from the federal government on Dec. 31. Is there any way for me to withdraw a portion of my thrift funds in order to outright purchase a home without taking a really bad hit with regards to income tax?