Q. My TSP question is based on an earlier answer you gave someone else: “A life annuity means that payments continue, on an accrual basis, until the annuitant’s death, unless a survivor benefit option is elected at the time of purchase.” When I die, are the funds remaining in my TSP inheritable by my adult child? If not, why should I leave it in the TSP not knowing when I will die? If yes, can the funds remaining in my TSP be rolled into an IRA or TSP that my adult child owns? A. If you use the funds in…
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Q: I retired from Federal Service under FERS at the end of May of this year with 24 years of service. I also turned 70 in early May of this year. My plan had been to purchase a lifetime annuity through TSP (METLIFE) in August of this year as annuity interest rates had typically been higher in August for the past few years (2006, 2007, 2008 and 2009). Unfortunately the rates have steadily decreased since my retirement and are now down to 2.750 percent, which is equal to the low of March 2009. Obviously this was not a good time…
Q. I am a Department of the Air Force civilian and I plan to retire in June 2014. I will be 60 and have 20 years of federal civilian service. I currently have my entire TSP tied up in the 2020 L fund. Is it too early to put all of my funds into government funds for stability purposes? A. It’s not a question of timing, but of spending. You can move all of your money into the G Fund, if that’s what you mean, any time you like, but you’ll be limited to the lifestyle that can be supported…
Q. Is it true that after retirement you cannot move your money around within the different TSP funds? A. After retirement, you may continue to manage your TSP account assets, including reallocating your money among the various funds, as you did before retirement.
Q. I sent an e-mail about two months ago asking a question about my TSP account. I’ve been working as a General Schedule employee for about 4½ years. I have all my money invested in one fund (the I Fund). I don’t want to work much longer and was wondering if it would be best if I divided it into three different funds. The S Fund, the I Fund and the C Fund. I checked and didn’t see a question along this line. Your advice in this matter would be greatly appreciated. Thanks. A: I did provide an answer to…
Q: I am 56 years old and have 33 years of combined federal service (20 years in the military and 13 years as a civilian), and due to personal reasons, I chose to retire on March 26, 2010. Approximately 14 months ago, I borrowed $50,000 from my Thrift Savings Plan account. I managed to repay approximately $10,000 of the loan prior to retirement, so I still owe approximately $40,000. Can you tell me approximately how much I will have to pay in taxes and the early distribution penalty? The reason I am asking is because I am in a position…
Q: My 2010 “annual” required minimum distribution from my Thrift Savings Plan will be approximately $8,500 (about $710 per month). My “monthly” withdrawals will be $2,000.00. If I roll over to a Roth IRA that part of my withdrawal that exceeds my required minimum distribution, can I start deposits to my IRA of $1,290 in January and each month after that, or do I have to wait until May, at which time my entire “annual” required minimum distribution will be met before I can make deposits to my Roth IRA? A: The limits are annual limits, so what matters is…