By Mike Miles
May 24th, 2011 | Uncategorized
Q: Could you please explain the MetLife choice we have for our TSP after we retire? I am trying to decide what to do with my TSP. I am retiring July 1 from the U.s. Postal Service. I would like to know what is the benefit of keeping my money in the TSP until 70 1/2 (I am 55) and what is the benefit of the Met life? I know nothing about this MetLife. Is it an insurance policy? I was always told not to invest in whole life insurance. Where can I read about the met life. Please give any info about the benefits of both and any downside.
A: MetLife is an insurance company and they offer immediate, fixed annuity contracts to TSP participants. You can learn more about the TSP annuity program at www.tsp.gov. The advantage of an immediate, fixed annuity is that it guarantees a predetermined stream of income for life payments for life (or longer) in exchange for a premium payment. The disadvantage is that you give up control of the principal and commit to a fixed income stream for life (or longer) when you buy the annuity. If you’re not sure about what to do, you should consult someone trustworthy to advise you. Buying the annuity is an irreversible decision and should not be taken lightly. If in doubt, keep your money in the TSP.