Q. I have a current loan that I am paying on in my TSP account. I am counting the days until I am 59 1/2 so I can make a withdrawal. Am I allowed only one lump sum withdrawal or, if I take a withdrawal while I am working, can I take another withdrawal when I retire in 4+ years? Is there a cap on the amount I can withdraw in my lump sum amount? Can I withdraw when I have a current loan with the intent of paying off the loan?
A. Under the current rules, you may only take a single, stand-alone, partial lump-sum withdrawal during your lifetime. You may request an age-based in-service withdrawal in order to repay an outstanding TSP loan balance. An age-based, in-service withdrawal is limited to the vested balance in your account.