Browsing: TSP withdrawal

Q. I am in FERS and considering retiring at my MRA. With my wife continuing to work, my pension (39 years including military buyback and one year of sick leave) and the Social Security supplement, I’m thinking I won’t need to withdraw money from my TSP. Where can I find guidance on when I have to start withdrawals, and how to go about withdrawing annual lump sums vs. monthly amounts.

Q. I wonder if this plan is viable. I retireg in a couple years with 10 years FERS service and around $200,000 in my TSP. I will be 65 at retirement, but don’t plan to collect Social Security until age 66. My plan is to take a one-time withdrawal of around $50,000 to pay off my mortgage. Following that, I plan to start monthly withdrawals at a rate equivalent to my upcoming Social Security income. When the Social Security payments start, I plan to reduce the monthly TSP collection to a nominal amount until I have to start taking the…

Q. I’m in FERS and am planning to retire at the end of this year at age 57 with 30 years of service. If I take a monthly payment, when do I have to submit my form TSP-70 to ensure I receive my first payment as quickly as possible? I understand the TSP needs to be notified of my retirement before they can provide my monthly payment, but I would like advice on how to time my retirement with my TSP withdrawal. Is the TSP automatically notified when my retirement is official?

Q. Do any of the TSP funds generate dividends that are automatically added to the account in the form of shares or are the only shares added to my accounts done when I and my employer purchase shares on payday. If certain funds do generate dividends in the form of shares added to my account how do I track them?

Q. I’ve decided that it would be financially advantageous for me to default on my current TSP loan, in order to pay off other, more pressing and expensive debts. My loan payment is currently deducted automatically from my biweekly civil-service paycheck by the Treasury Department. So I have three questions: 1) Is there a mechanism by which I can have Treasury stop making the loan payment/deduction? 2) If so, then if I do so as of Oct. 15, will I be liable for the taxes on the deemed disbursement in this tax year, or in the next tax year? (I…

Q. I will be retiring with a law enforcement 1811 pension. I will still owe $30,000 on a TSP loan.  I understand I will have to pay taxes on the loan as they will consider it a pay-out. My question is about the additional penalty that may be involved. I have read under the Pension Protection Act of 2006 (PPA), Section 828, which  allows a retired federal law enforcement officer to withdraw funds from their TSP.  When the IRS form 1099 reflects the distribution code of “early withdrawal – no known exception, the retired employee can file a form 5329 with the…

Q. I am 65 years old and have been retired 5 years from USPS under FERS.  My mortgage balance is $58,500 at 4.5%.   I pay $665/mo. for principal and interest.  The mortgage balance will be paid off in Dec 2023. My TSP balance is $129,000 and all in the G fund earning 2.5%. Right now I take monthly payments of $700 from my TSP.  I am thinking of increasing my monthly TSP payments (during open season) from the present $700 to $2,000.  I would then put an extra $1,200 per month towards my monthly mortgage payments.  I would then pay…

Q. Read your Money Matters columns in the Federal Times and am always intrigued by what advice you put for.  Particularly interested in a column you did for the October 6, 2014 issue, entitled “Why market timing is a sucker’s bet.”  I am a federal retiree with 30 years federal service, and have been retired 8 years.  One of the issues I wish you would discuss, either in association with the above column, or as a standalone, is how retirees can continue to invest, albeit in a more careful manner.

Q. I am 64 years old with 27 years of federal service and will retire in two years (FERS). I want to withdraw $50,000 now to help out my kids. When I retire can I make a lump-sum withdrawal? Can I make another withdrawal when I retire? If I took a lump sum I would probably invest most of it. What options do I have with my TSP money at age 66 when I retire after I withdraw money at 64?

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