Q: Are federal employees allowed to contribute directly to the Thrift Savings Plan, or does the money have to come out of their paychecks? A: Contributions can be made only through payroll deferral or by transferring money from another tax-deferred retirement account.
Browsing: thrift savings plan
Q: I am under the Federal Employees Retirement System and was looking at the Thrift Savings Plan annuity rate for April 2011, which is 3.625 percent. Using their calculator, at age 62 if I used $100,000 of my TSP to buy an annuity, it would pay $581 a month as long as I live. In order to get that out of the TSP, I’d have to earn 7 percent every year to be able to earn $583 a month! How is that so? Did I calculate something wrong? A: You’re forgetting to account for the fact that once you buy…
Q. I am a clerk with almost 28 years’ service in the Postal Service and am 60 years old. If I decide to retire this year, can I choose a monthly allotment from my TSP and then when I am 62, change the amount of that allotment from when I retired at 60? Or am I locked in to that amount? A. You may change the amount of the payment once each year in January.
Q. My husband is retired and has a fairly decent sum in the Thrift Savings Plan. He keeps talking about taking it out and investing it in mutual funds, etc. Is this smart or would it be better to leave it where it is? A. It would be better to leave it where it is! Lower costs, efficiently diversified, easy to manage, the G Fund. There’s no better place to invest for retirement income.
Q. My question on keeping my money in my TSP when I retire from the Post Office was answered (yes, I can keep it in until age 70 1/2) Now for the next question: If I decide to keep it in the TSP, can I add to it after I retire? I have heard that you can’t, please clarify this. If the answer is no, what would be the advantage of keeping it in? If the answer is yes, how would you do this, automatic from retirement payments? A. The only way to contribute to your TSP account after you…
Q. I am exploring the idea of retiring from the postal service as a CSRS with 32 years at age 55. Can I just leave my money in the TSP? Some answers I read say you can keep it in, but I have also read that I have to withdraw it when I retire. I prefer to leave it and not touch it for at least 10 years. So what is it? A. You can, and should, leave your money in the TSP until you have to begin withdrawing it -– usually at age 70 1/2.
Q. I am still employed by the federal government and am 63 years old. Am I permitted to transfer a portion of my TSP to an traditional IRA now, before I retire? I expect to retire in December. A. You may take a single age-based, in-service withdrawal and transfer or roll it over to an IRA.
Q. What fund diversification strategy percentages would you recommend for low to moderate risk tolerance for my TSP account? I am 57 with 27 years of FERS service. I plan to retire at age 60. I currently have $425,000, all invested in the G fund. I moved it to the G fund in October, 2009 after recouping all my losses of 2008. I figured the market would tank again and I would jump back in to take advantage of low share prices. Obviously, I was wrong. I want to get back into the riskier funds to maximize my returns without…
Q. On the TSP calculator “How Much Will My Savings Grow?” there is a field asking me to “Enter the number of years that you expect to keep your money in the TSP” I am trying to figure out how to answer this field. If at age 56 I choose the annuity or TSP monthly payment option, a large portion of my dollars will remain in the account. Only the monthly payments will be deducted. So, would I tell the calculator that the number of years my money will remain in the TSP would the number of years I am…
Q. I am a FERS employee with the Postal Service. I am 60 years old with 26 years employment. If I decided to retire this year, can I then withdraw monthly allotments from my TSP until I am 62 and then stop and roll it over into an investment plan? A. Yes, but it’s hard to imagine a better investment plan than the TSP.