TSP account strategy


Q: Next year, I’ll retire with 12 years of federal service and I will be 67 years of age. Should I keep about 225,000 in the Thrift Savings Plan and start required withdrawals at 70½ or purchase an annuity? Do you see any other option, and what is a reasonable exposure to stocks in percentage (C, S and I) at my age, even after retirement?
A: The question about whether to continue to manage your TSP account and take withdrawals for income, or use some or all of the money to buy an immediate annuity — through the TSP’s program or any other source you choose — is an important and, sometimes, complex question to answer. You certainly should not rely on “advice” coming from an internet forum or similar source that has not conducted the proper analysis. The annuity option should be used as the lowest-risk benchmark against which to compare your options. Similarly, the choice of investment allocations is not generic. The allocation you choose should be selected for it’s ability to meet your specific needs. You should seek help from someone who is competent to do the required analysis and provide consultation without conflict with your interests.


About Author

Mike Miles is a Certified Financial Planner licensee and principal adviser for Variplan LLC, an independent fiduciary in Vienna, Virginia. Email your financial questions to fedexperts@federaltimes.com and view his blog at money.federaltimes.com.

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