Financial Discussion

I asked this question in another section and got a good answer, though not practical, in my mind. Was told to get a General Purpose TSP loan, but though debt would be paid/reduced, I will be replacing one set of payments with another (TSP loan), possibly still not out of a 'real' negative cash flow situation. Do I have any other options - appeals, etc?


I'm a CSRS employee (36 years), with a sizeable TSP account. My wife's job was downsized in 08 and she has been earning 75% less since. I discontinued TSP contributions at that time. Over the years, we have incurred debt, especially credit card and college loans (3 kids) based on two full salaries. She's also had medical issues, which have been covered by FEHB, but co-pays have eaten most extra cash. Now the credit card minimum payments have gone from 2%, to 3 - 5% a month and the interest rates increased to 25 - 30%, greatly increasing the minimum monthly payments. The credit limits have been reduced, limiting future purchases. I was researching a TSP In Service hardship withdrawal (as a last resort - I understand the costs involved). 'On paper' we don't meet the negative cash flow criteria because the worksheet, Item A percentage for ordinary monthly household expenses including CC, Charge accounts and interest, is too low for our income/family size compared to what we actually owe. When I run the numbers for worksheet item A, using 'real' household expense data, we have a significant, monthly negative cash flow. Do I have any other options within the TSP system.? (house is 'underwater', so no refinancing and trying to avoid the big B)

3 and 1/2 years away from 59 1/2.