Q. I’ve been reading your archives for CSRS Voluntary Contributions Program (VCP) and the strategy of rolling its balance over into a Roth. Since TSP offers such low management rates, a TSP Roth is my intended destination for these VCP funds. But as of your 2012 guidance, the VCP cannot be directly into a TSP Roth, as the VCP is not a “designated Roth account.” Has this guidance changed? If not, then can this still be done by transferring the VCP funds twice – from the VCP into a generic non-TSP (commercial) Roth and from that non-TSP Roth into the TSP…
Q. When you lose money in the TSP C,S or I Funds (during a correction or crash), is it only on paper and only temporary until the market rises again at some point? The only time you really lose money is when you sell in a down market and “lock” in your losses, correct?
Q. I am a FERS employee with 33 years of service and will be eligible to retire at the end of the year when I turn 56. Upon retirement, I would like to keep my 401(k) money in my TSP account, but would like to take out approximately 4 percent per year in monthly payments. Would this be subject to the 10 percent IRS penalty for withdrawals before age 59 1/2?
Q. I plan to retire in September 2018 at the age of 58. Does it make sense to withdraw the max amount from TSP annually and remain in the 12 percent tax bracket or just take the minimum I need and pay more on taxes when I turn 70 and start drawing Social Security and required minimum distribution? If I choose option 1, I would probably invest the extra somewhere.
Q. I have my personal investments with Wells Fargo. Would it be practical to move all of my Wells Fargo investments to the TSP to avoid the 1 percent fees I am charged? I know the TSP is very low cost.
Q. The state of Hawaii does not tax social security and government pensions and annuities. If I purchase an annuity through TSP with my TSP balance when I retire and begin receiving lifetime income, is this considered a “government annuity” and therefore not subject to Hawaii state income tax?
Q. I have a current loan that I am paying on in my TSP account. I am going to retire in May 2018 and I have already made a in service withdrawal from my TSP account. I will be 86 years of age when I retire, with more than 28 years of service. Is it possible to take a withdrawal to pay for the outstanding loan in the amount of $18,000? I do have a balance in my TSP account of more than $320,000. I have no other way to obtain these funds.
Q. I am a separated federal employee, not of age and I am on Office of Workers’ Compensation Programs federal disability. I’m going to do a TSP early withdrawal. I have a few questions that I could not find while researching my options: 1) Being on federal disability, can I even apply for financial hardship withdrawal? 2) What is the difference (if any) between financial hardship withdrawal & early partial withdrawal? Is there any benefit filing one or the other? 3) At the end of the year I know I’ll have a 1099 and there is a 10 percent penalty.…
Q. I was forced to liquidate almost all of my savings, stocks, etc., five years ago to assist a family member with some much-needed medical financial assistance. I am 54 years old, and plan on working for an additional 14 years. I’m currently putting $350/pay period into TSP with contribution allocations in L2030 (10%), C Fund (45%) and S Fund (45%). Balances are $13,662, $2,730 and $10,986, respectively. Every opportunity I get, I increase my contribution. Here’s my question: Based on the short amount of time I have left to retire (14 years), is my allocation percentage into the three funds…