Q: I am a federal law enforcement officer (10 years+), and was injured at work. As a result of my injury, I may have to accept a medical retirement. I have not bought back my military service time. Is there any benefit to buying my military time back if I receive a medical retirement? Also, what happens to my TSP? What happens to my federal health insurance? Will I receive my Social Security immediately? A: Because you are covered by FERS, if you apply for disability retirement you will also have to apply for Social Security disability benefits, otherwise your…
Browsing: retirement
Q: I am 59 and retired from the post office since July 2009. I receive payments of $900 a month and would like to get a lump sum. Would I have to pay a penalty? A: If you’re receiving level monthly payments, not based on your life expectancy, and not incurring the penalty on those, then your lump sum will not incur the penalty, either.
Q: I am a FERS employee with the United States Postal Service. When I retire will I be permitted to withdraw the funds in my annuity, my TSP, my accrued vacation and sick leave to be reinvested into private accounts so they can be inherited by our children upon the deaths of myself and my spouse rather than be sucked back into the government’s coffers? If so what forms would that require? A: You may withdraw your TSP account balance immediately after you retire, although the vested amount is yours to keep and not at risk of being “sucked” back…
Q: I am 65 and plan to retire soon. I would like to stay in the TSP as a FERS retiree. However, the inability to withdraw money while taking a monthly distribution has me considering transferring to an IRA. Do you see any possibility that the TSP will change the inability to withdraw money as necessary while having monthly distributions? A: Of course it’s possible. If you decide to roll over your balance, you would be smart to try to duplicate, as closely as possible, the advantages of the TSP in your IRA account. That means using low-cost index funds…
With the new year, change has come to the Thrift Savings Plan’s lifestyle funds, or L funds. One fund, L 2010, has been retired. Another, L 2050, is set to become available at the end of this month. The L funds are a set of five investment funds that are professionally designed with different asset allocations of TSP’s five underlying funds — the C, S, I, F and G funds. The allocations are automatically adjusted in relation to how soon an investor will retire. TSP recommends that you select the L Fund with a maturity date that most closely matches…
Q: I plan on retiring in 2015 from the Postal Service at the age of 56, with 31 years of service. I am FERS and will have about $400,000 in my Thrift Savings Plan account. Would it be wise to withdraw this money at the time of retirement to pay off my mortgage, son’s school loans and all remaining bills? This way, I will have no expenses and could live strictly off my Postal Service retirement and the Social Security Supplement. If I understand it correctly, I wouldn’t be charge a penalty because I would reach my minimum retirement age…
Q: I am 70 and plan to retire when I am 72. I received a letter from TSP saying I am going to start receiving a mandatory payment amount effective now. I do not wish to draw money until retirement. What can I do to delay the payments? A: If you are still working for the government, you received the payment in error. You should report the error to the TSP.
Q: If I retire at age of 56½ and elect to draw equal payments from my TSP, will this be considered earned income? A: It would be considered ordinary income, but not “earned income.”
Q: I retired under both CSRS and FERS (converted to FERS in 1998 after 22 years with CSRS) under 6C law enforcement provisions at age 52. At the time of my retirement, I chose not to take a withdrawal from my TSP account. I am now 57. When can I take a withdrawal from my TSP account without penalty? At the time of my retirement, I was led to believe that I could do so at age 57 1/2. I am now being told I must wait until age 59 1/2. A: You’ll have wait until age 59 1/2 unless…
Q: I have $110,000 in my TSP account. I took out $40,000 for a home loan, and I still owe $25,000 on it. I want to retire in April 2012 at age 56. How will the unpaid loan be handled? How much will come out of the $110,000 I have in the account? A: The unpaid loan balance, including interest, will be declared a taxable distribution from your account.