Q: At a recent retirement seminar the speaker stated that if you passed away, your spouse would be able to receive the balance of your TSP account, but your children would not. He stated it would go back to the government. Could you please tell me how this would work? My husband and I are both federal employees and both have TSP accounts.
A: Not true. Your TSP is paid out according to your beneficiary designation. If your designation is not on file, your account will be distributed according the following statutory order of precedence:
1. To your widow or widower;
2. If none, to your child or children equally, and to the descendants of deceased children;
3. If none, to your parents equally or your surviving parent;
4. If none, to your appointed executor or administrator of your estate;
5. If none, to your next of kin who is entitled to your estate under the laws of the state in which you resided at the time of your death.