BIG CHANGES ARE COMING TO TSP WITHDRAWAL OPTIONS!

 

In 2017, the TSP Modernization Act was passed. This Act called for greater flexibility on when and how

TSP participants access their money. An overview of the changes, which will become effective September 2019, is listed below.

 

 

CURRENT WITHDRAWAL RULES:

• You are limited to one partial withdrawal in your lifetime once you reach 59 ½, either while you are working or after you leave service.

• If you have both traditional and Roth balances in your account, any withdrawals are taken on a proportional basis.

• You must make a full withdrawal election after you turn 70 ½ and are separated from service.

• If you choose installment payments after you leave service, they are paid on a monthly basis and you may only change the amount of the payment once a year.

 

NEW WITHDRAWAL OPTIONS:

• You can take up to 4 partial withdrawals per year after age 59 ½ while working and an unlimited number of withdrawals after separating from service.

• You will still have that option, but you will also be able to withdraw from only your traditional balance or from only your Roth balance.

• You will never be required to make a full withdrawal election.

• In addition to monthly payments, you may choose to receive payments on a quarterly or annual basis and you can start, stop or change the amount of the payment at any time during the year.

 

FOR MORE DETAILED INFORMATION ABOUT THE CHANGES:

Review the TSP Fact Sheet: Questions and Answers about Changes to TSP Withdrawal Options at www.tsp.gov. If you have questions about how these changes may impact your retirement planning, contact our Personal Financial Counselor.

 

Susan Kelley-Outten,

Personal Financial Counselor

802-318-2507 or email her at susan.kelley-outten.ctr@mail.mil

This is a free and confidential service for service members and veterans.

 

 

Vermont Veterans Outreach Personal Financial Counselor provides financial services to Vermont’s Veterans, Service Members and their families. These services include budgeting, debt reduction, retirement planning, and much more. Our Family Program Personal Financial Counselor can assist you in your efforts to become financially stable and independent. The Personal Financial Services integrates within the military life-cycle; from pre-deployment financial preparation activities through transitioning from the military to civilian life. These services are free, confidential and available to Veterans and families residing in Vermont.

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