Ask The Experts: Money Matters

By Mike Miles

TSP withdrawal

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Q. I’ve heard conflicting reports about TSP withdrawal and would like to get an answer about my particular situation: I have 22 years with the Bureau of Prisons, and I’m eligible to retire any time. I will be 55 years old this year, but I want to work until 2016 (mandatory retirement age of 57). Can I withdraw a portion of my TSP while I’m working to pay off some debt (which is not a hardship case) and take the penalty, and at the same time, leave the rest in the TSP until I separate from the BOP?

A. No, the only in-service withdrawals permitted are age-based and hardship, and you don’t qualify for either. You could take a loan, however.

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