TSP for college


Q. I am in the middle of my career. Is there any way to move a portion of my TSP to a Roth IRA and then use it for my kids college without a major penalty?

A. If you are under age 59 ½ and still employed in a TSP federal job, then no. If you are at least age 59 ½ and haven’t already taken one, you could take an age-based, in-service withdrawal from your TSP account and then convert it to a Roth IRA. Since you will owe taxes on the conversion and plan to spend the proceeds, I’m not sure what the advantage of using the Roth IRA to accept the funds would be. Why not just take what you’ll need and use it to pay your bills?


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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 fedexperts@federaltimes.com and view his blog at money.federaltimes.com.

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