TSP
Top 5 TSP Questions from Federal Employees
After separation, you can:
- Take partial withdrawals
- Set up monthly payments
- Request a lump sum
- Purchase a TSP annuity
You can mix and match these options, and changes to installments can be made at any time.
- Starting in the year you turn age 73 (if born in 1951–1959) or age 75 (if born in 1960 or later), RMDs apply. The TSP automatically calculates and sends them unless you act earlier.
- Withdrawals from Traditional TSP are fully taxable as ordinary income. Roth TSP withdrawals are tax-free if you're age 59½+ and it's been 5+ years since your first Roth contribution.
- Many ask this after retirement. Pros of keeping it in TSP include low fees and G Fund access. Pros of rolling to an IRA may include more investment choices and simplified estate planning. There's no one-size-fits-all answer — it depends on your goals.
- No. Once you separate from federal service, you can no longer contribute. However, your account continues to grow with market performance and accrues interest, especially in the G Fund.