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Federal Employees Benefits Q &A

Do you have questions about your federal employee CSRS or FERS pension/annuity or federal employee retirement planning? Concerns about your Thrift Savings Plan (TSP) account or what about federal employee pay and leave issues?

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Hank6285  
#1 Posted : Wednesday, April 21, 2021 7:40:54 AM(UTC)
Hank6285

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Hi Ed,

I plan on retiring at age 57. I will have to withdraw from my TSP & IRA to do so. Since I can’t withdraw from my IRA until 59 1/2, should I roll over my IRA into my TSP? Or, should I withdraw from my TSP first & then from my IRA when I reach 59 1/2?

Here is an estimate & my plan: 500k in TSP & 500k in IRA. I need approximately 50k per year until SS kick in. (I’m aware of taxes). If I roll over everything into to TSP, I will have approximately 1 Mill. I can withdraw just the interest (6-7%) & have my 50k. I would also still have my original principal. Otherwise, I would be liquidating my principal from my (500k) TSP if I only withdraw from that first.

Make sense? I greatly appreciated your help & opinion.
roger.d  
#2 Posted : Sunday, April 25, 2021 11:02:00 AM(UTC)
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My thoughts:

Is any of your IRA money in a Roth account? If so, you can withdraw your contributions with out penalty before ag 59 1/5. If not, consider opening a Roth and make your contributions to that until you are retired.

Where is your IRA account? Firms like Vanguard, Fidelity and Schwab have lower expenses than the TSP. Consider moving those funds to one of those companies.

Are you married? The TSP has some hurdles you need to go through to make changes to your withdrawals.

And finally, when you die, I don't feel the TSP is as favorable in transfers to your heirs as an IRA.

Good luck!
Socialist governments traditionally do make a financial mess. They always run out of other people’s money. --Margaret Thatcher
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