Borrowing from TSP


Q. I have two Thrift Savings Plan accounts — one with the military and one civilian. Because of my financial situation, I would like to take some money out for debt consolidation. I was weighing the option of borrowing from my civilian vs. closing my military account (which I am no longer contributing to) and using those funds.

If I close my military account, can I roll a portion of it over to my civilian account, and use the rest?

What/how much of a tax penalty am I looking at if I do either?

Would it make sense to close my military account and just borrow from my civilian account? I may possibly get called back on active duty.

I need to make a decision within the next two weeks as I have a number of financial obligations hitting the first of November.

A. You may use form TSP-77 to request a one-time partial withdrawal from your civilian and/or your uniformed services account(s) if you are at least age 59½ or separated from service. You may combine the accounts if you are separated from service using form TSP-65.  If you are subject to the early withdrawal penalty, the penalty is 10 percent of the withdrawn amount. There is no penalty for taking a loan at any age. Unfortunately, there is insufficient information here for any specific advice.


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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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