Meeting the 72(t) exception to the early withdrawal penalty


Q. I am 49 years old and have 24 years of service with the Bureau of Prisons. If I retire at age 51 with 26 years of service and elect a life expectancy withdrawal from my Thrift Savings Plan account, would I be able to change to a specified amount at age 55 without a 10 percent penalty, or will I have to wait until age 59½ to change my withdrawal option to avoid the 10 percent penalty?

A. To meet the 72(t) exemption to the early withdrawal penalty, your series of payments cannot change until it has been completed — in your case, until age 59½. You must pick a payment calculation method, either life expectancy or qualifying fixed, and stick with it.


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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 and view his blog at

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