Age-based withdrawal and outstanding TSP loan


Q. I’ve looked through the various combinations of possibilities on your web page (very helpful, thank you), but have not seen my exact question answered. I am having financial difficulties. I am 57 years old with 20 years of service and don’t plan on retiring for at least 5 years. What I would like to do is take out a TSP loan, then when I turn 59 ½ take an age-based disbursement for enough to pay back the balance of the loan and have some money left over. Can I do it that way? Or would I be required to pay off the loan before getting an age-based disbursement?

I would think they would just deduct the amount of money I still owe from the disbursement. For example, say I took out a $50k loan now. In 2 and ½ yrs I’d still owe around $25-30k. Could I take my one-time age-based disbursement of say $100k with the loan balance deducted from that amount?A: Having a TSP loan outstanding does not preclude you from taking an age-based in-service withdrawal.


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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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