Browsing: monthly

Q. I am under FERS. I want to purchase a Thrift Savings Plan annuity. After I retire, is it possible for me to add funds to my TSP savings to increase my monthly TSP annuity? A. The only way to add funds to your TSP account after you retire is to transfer money in from a qualified IRA or employer-sponsored retirement plan. This will have no effect on a TSP annuity that has already been purchased, however.

Q. I have $300,000 in my Thrift Savings Plan and am retiring soon. I plan on taking $40,000 out to put into my checking and then roll the remaining $260,000 into an account that I can make monthly withdrawals for the rest of my life. I am 60 years old. What percentage of this should I take out monthly (I’ve heard anywhere between 4 percent and 6 percent) … to make it last? What is your recommendation? A. First, you should take out enough to create a spending fund and then take the monthly withdrawals from your TSP account. No…

Q. I started taking 4 percent of my Thrift Savings Plan when I retired. When I reach 70½, will I have to make a total withdrawal or will I be able to take life expectancy payments? I am CSRS Offset if that makes a difference. A. You may change the amount of fixed monthly payments once each year or you may switch from TSP calculated payments to fixed payments, but not the other way around. See the publication at https://www.tsp.gov/PDF/formspubs/tspbk02.pdf for info.

Q. I was downsized when I was 46 and rolled over everything into a 72(t). I am currently withdrawing from it monthly as I cannot find a job that pays enough to live off of. I am in a situation now where I need some extra money to clear off some debt and buy a new car. Can I take a one-time withdrawal from my 72(t), in addition to my monthly? If so, what are the tax implications? A. You may not change the annual withdrawal scheme as calculated and required under 72(t). If you do, the 72(t) exception to the…

Q. When I retire at age 57, can I withdraw a small portion of my Thrift Savings Plan, pay the 20 percent penalty and leave the remainder as set monthly payments with the tax as three dependents? A. If you retire at 57, you may take a partial withdrawal, if you haven’t already taken one, with no early withdrawal penalty. You may also take a full withdrawal as a series of monthly payments. Check the table on Page 3 of the notice at https://www.tsp.gov/PDF/formspubs/tsp-536.pdf for information on tax withholding requirements.

Q. If I start taking my retirement now at 62 — FERS, Thrift Savings Plan payments and Social Security — and end up being picked back up at some point in federal service: I understand my FERS benefits would be cut by the amount I make in a new job. What about TSP payments? Are they exempt from penalties of re-employment? A. If you are rehired, your automatic monthly payments will stop and you will be subject to the in-service withdrawal rules.

Q. Upon retirement, I’m considering transferring a portion of my Thrift Savings Plan balance in monthly payments directly into a Roth IRA. Since my TSP is pretax, I understand that taxes will need to be paid on these funds upon conversion to a Roth. I am in a state with no income tax on federal pensions and distributions from the TSP (North Carolina) and want to be sure that this transfer from my TSP to the Roth will be considered a TSP distribution for tax purposes, and therefore, subject to federal and not North Carolina taxes. Does the Office of Personnel…

Q. I will retire within the next eight years. When I get ready to withdraw my Thrift Savings Plan, can I do it at various intervals or annually? I hear you may have to take it all out at one time. A. You may withdraw your money as a lump sum or through monthly withdrawals. Visit www.tsp.gov to learn more about your options.

Q. I will be 63 years old in August. I have made a previous partial Thrift Savings Plan withdrawal but need another for a down payment on a home. 1. Can I make another partial withdrawal?  If not, what regulation dictates that I cannot? 2. If I can’t make another partial withdrawal and decide to take monthly payments, can I set the monthly payment amount or does TSP have a required monthly distribution rule?  And will the remaining balances continue to earn income? A. You are limited to one partial withdrawal during your lifetime. I’m not a lawyer, so you’ll…

Q. I am 60 years old and, for seven years, have been separated from 21 years of federal service. I have never made any withdrawals from my Thrift Savings Plan account. I am interested in making a partial withdrawal for home improvement projects. I understand a one-time partial withdrawal leaving the rest in TSP for later is allowed, but does one-time mean that if I make a one-time partial withdrawal now, I will not be allowed to make a full withdrawal of the remaining money later when I am fully retired to perhaps pay off the mortgage? Will I only be allowed monthly…