Q: Is there a certain time/age requirement for drawing out your TSP? A: You must start taking Required Minimum Withdrawals based on your life expectancy by April 1 of the year after the year you turn 70 1/2, or when you separate from federal service, whichever comes later.
Q: I am considering retiring at the end of 2011. I have all my thrift in the C fund. I don’t plan to use my thrift savings to live on during retirement or to withdraw it. What is the best option for me to do with my thrift, leave in? Withdraw it and place in an IRA? What do you advise? A: The TSP is the best investment vehicle you’re likely to find, anywhere. Leave your money there as long as you can.
Q: I plan to retire at the end of November 2011 with about $230,000 in my TSP. I need to withdraw about $25,000 to pay off a loan and I plan to transfer the remainder to an annuity. I understand the tax bite on the withdrawal will be about 20 percent. Would it be to my benefit to wait until after Jan. 1, 2012, to withdraw the $25,000 because I will be in a lower tax bracket as opposed to 2011 or does it matter? A: It might be. The answer will depend upon your specific circumstances and what happens…
Q: I am considering shifting my savings from the L2030 into the L2050 now while the share prices are low ($10.14 as of today). Do the share prices grow strictly by fund performance or by the number of shares held? I understand that the fund balancing is by design more aggressive and the chance for loss is greater. But if I made the switch would it not make more sense to do so now at the lower share price? A: In this case, it makes no sense at all.
Q: I retired in 2008 and I am collecting my annuity from CSRS. I made a one-time withdrawal from my thrift in 2010. Can I now transfer my IRA into my TSP or am I too late? A: You may transfer money into your account.
Q: Can I first choose a set monthly payment and when I turn 70 will TSP do calculations for RMD? A: No.
Q: I would like to receive 5 percent a year of my current TSP balance in monthly payments and not reduce my current balance. What percentage would you recommend to put in each fund to achieve this? A: There is no fixed investment allocation, in the TSP or otherwise, that will guarantee you what you want. The closest you’ll come is 100 percent allocation to the G Fund, but right now you’ll have to settle for less than 5 percent.
Q: I would like to leave my money with TSP and receive monthly payments; however, I want to receive less than the monthly interest would be and let to rest go into my account so that my principle would increase. Is this possible? How do I go about finding out what the monthly interest would be? A: You can’t.
Q: How would I transfer money from one account to another, for example from the C-fund to the L-50 fund. A: Either through your account access at www.tsp.gov or by calling the ThriftLine at 877-968-3778.
Q: I have $37,000 in my TSP L-Fund plus a $21,000 cash value on my life insurance policy. I plan to leave the USPS with 32 CSRS years of service soon when I turn 58. I have had a financial adviser suggest I put the combined money into an annuity-life insurance combination that he says will give me a better rate of return over a period of time. I have put the extra money into the TSP to use for extra expenses after retirement, (new roof, newer car, etc.) after I turn 59 1/2. I am afraid the annuity-life insurance…