Browsing: IRA

Q. I agree with you that the TSP is hard to beat when it comes to maintenance costs, etc. However, the TSP’s limited options when it comes to withdrawing the money don’t fit into my retirement plans. I’m considering using the TSP partial withdrawal option to roll over about half my TSP into a Vanguard IRA when I retire. At a later date, I’d use the full withdrawal option to move the rest of my money into the Vanguard IRA. That way I’d have some money readily available to me and I’d be leaving some in the TSP for as long as possible. Is there anything that…

Q. I am a 62-year-old government employee and will have had a Roth TSP opened for five years by 2018. I plan on doing a rollover to a Roth IRA after I retire from government. Does the five-year window restart for tax-free withdrawals after the money has been transferred from the Roth TSP to the Roth IRA?

Q. Let’s suppose I have a TSP account balance of $300,000, and when I die I leave the $300,000 to my spouse in a beneficiary participant account (BPA). She then sets it up so the two children we have are beneficiaries in equal shares. When she passes, my understanding according to TSP rules is the children cannot transfer the money into an inherited IRA to minimize their tax consequences. The money will have to be paid out in equal shares to the children and be fully taxable. I was told that in this case the spouse should transfer the money out of…

Q. My husband is 69 and turns 70 in February 2017. He took a job with the VA at the end of his career and became eligible for and invested in the TSP. He has a small amount in the TSP account, but most of his money is in Vanguard funds. My husband is now fully retired. Is there an advantage to rolling over his IRAs into the TSP?

Q. I have read several of the Money Matters articles regarding the fact that the SEP IRA can be transferred into the TSP. However, when I looked at the TSP 60 Form, Section II, Block 13, it lists a Traditional IRA, SIMPLE IRA and Eligible Employer Plan as choices for transfer to the TSP. If a person has an SEP IRA to transfer to the TSP, would they select the SIMPLE IRA or Eligible Employer Plan for this situation? Would the person need to explain to the TSP in an attachment that it is an SEP IRA transfer?

Q. I understand you’re a proponent of leaving your money in the TSP at retirement, mainly due to low cost. However, are there benefits to rolling it into an IRA? I’m thinking along the lines of inheritance for my beneficiaries. I thought I read once that the options for beneficiaries are more restrictive with TSP. What are the advantages and disadvantages of the two choices? I am a FERS retiree who is 62 years old.

Here’s a pop-quiz question for you: How many partial lump-sum withdrawals are you allowed to take from your Thrift Savings Plan account during your lifetime? Go ahead, write down your answer. Everyone knows that the answer is one, right? In fact, that is the stated limit in every TSP publication that I can remember seeing. This limit is also one of a number of common reasons that TSP participants decide to roll their account assets from the best retirement investment vehicle in the United States into an individual retirement account after retiring. But, while the TSP’s withdrawal restrictions are inconvenient,…