Browsing: military service

SEPP

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Q. I am retiring from the Army after 22 years of service and I am 45 yrs. old. Can I start withdrawing from the Thrift Savings Plan and avoid the early withdrawal penalty by taking a series of Substantially Equal Periodic Payments? How does that work? My life expectancy is 37.7 more years, according to the Internal Revenue Service, so is that the number of years my funds can be distributed? If so, do I then divide what I saved by 37.7 and again divide by 12 to see what my monthly payments would be? A. You may avoid the…

Military service and Roth TSP

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Q. I am 25 and now have the option to contribute to a Roth TSP. I have four years left on my military contract before I have the opportunity to get out. Seeing that my future with the military is somewhat questionable, would the Roth TSP still be a favorable option? A. Except for tax-free pay earned in a combat zone, I don’t see any reason to expect that contributions to the Roth TSP are somehow better than contributions to the traditional TSP. In fact, I recommend that you favor the traditional TSP over the Roth TSP unless your circumstances…

Transfer to L Fund?

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Q. I have 10½ years of combined federal and military service and roughly $15,000 in my Thrift Savings Plan, 100 percent allocated to G Fund. I am 33 years old and nowhere near retirement. I plan on working another 22 years for the federal government and do not plan to start using my TSP until I am in my 60s. What would be the best way to allocate my contributions? I’ve had a few friends tell me to shift over to L funds. A. If you’re not sure what to do, then I recommend that you use the L Fund that most…

Keep money in L Fund?

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Q. I retired from the Air Force in 2004 after 30 years of service. I was rehired into the civil service ranks in November 2004 and immediately started investing into the Thrift Savings Plan’s L2020 account. I just turned 58 and plan on retiring when I hit 60, maybe 62 if my health holds up. How long should I keep my investments in the L2020 account? As I get closer to retirement date, should I move it from L2020 to one of the individual funds? A. If you’re not sure about what to do, to support you goals with a…

TSP rollover

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Q. I recently retired from the military. I had $30,000 in the Thrift Savings Plan. I have no plans on returning to federal service. I have Roth IRAs with two other private companies, each with less than what I had in the TSP. I want to remove these from TSP and place into either a new Roth or one of my existing accounts, which makes more sense as a larger pot of money will earn me more since I can continue to contribute. This opens a new concern as the limitations of combined income and contributing to a Roth. I…

Want to retire this year

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Q. Current age: 56 Entered U.S. Navy active duty: May 1978 Active-duty military time: 11 years, four months Retired reservist after 26 years as an O-5 Entered civil service: November 1997 Current paygrade: GS-9, Step 8 Received a $30,000 severance pay when released from active duty in January 1989 Points accumulated, active and reserve, for retirement: 5,245 What do I need to do to retire at the end of this year? I know you can’t tell me what I should do, but if you could give me guidance as to what I need to do so I can make an…

Withdrawing to invest in hard assets

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Q. I have 19 years of federal service (counting the 10 years active duty I bought back). I am 51, and I fall under FERS. I don’t trust the government retirement system with what is going on in the economy and would like to invest in gold or silver, but I don’t trust it being in some IRA in another state, that if everything were to go south, I wouldn’t get anything anyway. Is there any way of withdrawing some or all of my funds without penalties to invest in hard assets? A. Not until you reach age 50½ or…

TSP

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Q. I have six more years of active duty in the military. I have approximately $62,000 in my Thrift Savings Plan, 100 percent is in the G Fund. What would be the best fund for investment for my age and retirement in six years? A. It’s impossible to say from this information. The correct answer depends upon how and when you plan to use the money.

Start Roth TSP at age 54?

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Q. I am 54 years old and I have 30 years of federal service under FERS. Should I start a Roth TSP at age 54? I was born in March 1958. I plan to work until I hit full Social Security, which, I think, is 67 or maybe 66. Bottom line: If I were to start the Roth TSP until retirement at age 67 or 66, which is 13 or 14 years from now, is it worth my time and effort? My current Thrift Savings Plan is about $230,000 as of July. Six years from now, about March 2018, I will be…

Contact for TSP

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Q. I served six years in the military and was honorably discharged in 2005. I can’t remember if I had a Thrift Savings Plan or not. Who can I contact? I’m receiving disability benefits through the Veterans Affairs Department. Would they know? A. Start by contacting the TSP (www.tsp.gov).

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