Ask The Experts: Money Matters

By Mike Miles

Mandatory retirement and TSP withdrawal

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Q: I am a firefighter about to be forced to retire at 57 years old because of the mandatory retirement age. I plan on taking out my Thrift Savings Plan earnings to buy my house when I retire. Do I still have to pay the 10 percent penalty for withdrawing from my TSP before turning 59 1/2 even though I was forced to retire because of my age?

A: Because you are retiring during or after the year in which you reach age 55, your subsequent TSP withdrawals will not be subject to the early withdrawal penalty.

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Comments

  1. Gary B. Sasin Says:
    August 3rd, 2010 at 5:03 pm

    I have a question. When the TSP reduced our fund movement to only twice a month they also stated that if you completed an Interfund Transfer on the last day of the month that your funds would be transferred and you would gain the profits from the first day of that fund being traded correct?
    If this is correct, then why was my Interfund Transfer held until Monday midnight and I did I not receive the 2.88% that was gained?

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