Q. I am 59 years of age and will retire with 35 years of federal service (FERS) in five years. I have approx $250,000 in TSP. An advisor wants me to rollover $200,000 of my TSP funds into a fixed index annuity with ATHENE. He states if the market goes down it will not affect my monthly allotment. Why would I do this if TSP offers an annuity as well (single life) with lower overhead and surrender fees? In other words, is a fixed index annuity a better option than TSP’s single life annuity?
A. You’re confusing a salesman with an “advisor,” which is a serious mistake. He’s advising you to pay him a sales commission! There is no generally correct answer to your question. The two options should be compared by a competent and UNBIASED analyst. If you’re not sure, you should stick with the TSP since you can be sure that they are not trying to take advantage of you.
