Q. I am covered under the FERS and plan to retire at the end of April 2017 at age 57 with 33 years of service. I intend to take out a TSP general purpose loan just prior to retirement to pay off some debt and then employ a combination withdrawal strategies for the remaining balance: TSP monthly payments, partial lump sum (paid to me) and a rollover to an qualified IRA. I want the monthly payments to start as soon as possible but delay the lump sum and rollover to occur in 2018. Is this a sound plan? Can the withdrawal options be enacted separately? What’s the average wait time for monthly distributions when there is an outstanding loan?
A. Once you start the monthly withdrawals, your only remaining options are to change the amount of the monthly payments or to take a final, full withdrawal. You may not file form TSP-77 after you have filed Form TSP-70.