TSP dispersal


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.


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.

1 Comment

  1. Amazed in the USA on

    WOW!! Why don’t you demand this answer from TSP!!
    It’s not like they are keeping it from you.
    This information is on the TSP-Form 3 Second Page.
    Located at http://www.tsp.gov
    Or call them!! ThriftLine — 1-TSP-YOU-FRST

    It’s your money!!! Isn’t it?

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