Q. I am a Federal Employees Retirement System employee and a reservist. I have a uniformed service Thrift Savings Plan account and would like to use some of the money to buy in to my FERS annuity. Does the FERS annuity qualify as a tax-deferred retirement plan, or will I have to pay taxes on the money? A. You’ll have to pay taxes on the money.
Browsing: annuity
Q. Now that I have retired and am over the age of 59½, can I have monthly annuities coming to me for life? How? A. Yes. You may use your Thrift Savings Plan money to purchase a life annuity from their provider, MetLife, or any other insurance company you choose (by rolling over the money to an Individual Retirement Account). Visit www.tsp.gov and search for “annuity” or call the ThriftLine at 877-968-3778.
Q: In the late 1990s, I invested money in a Franklin Templeton T-Roth IRA and a Hartford Variable Annuity investment. I would like to bring these investments into my TSP account. I understand TSP will begin to offer Roth options in the second quarter of 2012. Would I simply be able to roll over my Franklin T-Roth accounts into Roth accounts offered by TSP? And how would this relate to the $17,000 ceiling on TSP investments for 2012? From my limited understanding regarding variable annuity investments, it sounds like I would need to liquidate these accounts in order to move…
Q: I am 62 with 22 years of federal service. Recently, my agency offered a buyout. I was thinking about taking the buyout and retiring. Here is my reason for not doing so. I have been reading horror stories regarding OPM’s incompetency regarding our annuity checks. Some people have been waiting as long as a year. They cannot get any response from OPM. Since the third leg of my retirement TSP has lost so much money, I would have to drain it in order to survive. Should I stay or go? I also will have surgery in early 2012 and…
Q: I read your article about a fully inflation-indexed immediate life annuity. How does it work, and since TPS doesn’t offer it, who should we turn to in order to find out more information? A: My article was arguing for the development of an inflation-indexed annuity for federal retirees. No such solution currently exists. I encourage you to contact your members of Congress to suggest that such an annuity be part of any retirement reform package.
Q. I know that the TSP annuity means giving up your money forever, something to be carefully considered. I’m still trying to understand the math. If at age 62 I bought a $100,000 annuity, even at today basement rates of 2.37 percent, it would pay $497 a month, or $5,964 a year. That’s equivalent to earning a steady 5.964 percent on your money! How does 2.37 percent turn into almost 6 percent? I’m guessing that Met Life is figuring that some of us aren’t going to live long enough to collect a great amount on the annuity. Is that it?…
Q: Can you purchase a life annuity after you have been retired for several years? A: Yes.
What is the one thing federal employees need most when it comes to retirement planning? A fully inflation-indexed immediate life annuity. The one missing piece of the retirement puzzle for federal workers is the option to use their Thrift Savings Plan balances to create a stream of income that is guaranteed to last a lifetime and to maintain its purchasing power over the years. Yes, you do have the option to purchase a TSP annuity, but it has what may, for many, be a fatal flaw: It doesn’t guarantee that the payments will keep pace with inflation. Planning for retirees…
Q. I am trying to decide on how to receive payments from my TSP account. How can I get an estimate on how much I would receive through a life annuity? A. There is a calculator on the TSP website at https://www.tsp.gov/planningtools/annuities/annuityCalc_select.shtml.
Q. I am a Postal Service employee scheduled to retire Oct. 1. I am 60 years old. Can I take a partial withdrawal from my Thrift Savings Plan account and invest that portion in a private annuity and then take monthly payments from what is left in my TSP account? A: Yes, as long as you have not already taken a partial withdrawal from your TSP account.