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Follower ○○○

TSP question regarding withdrawing funds

when retired and making a withdraw from your TSP account does TSP allow you to pick which fund you withdraw from or are you forced to sell portions of all your investments for the withdraw. Tell me this isn't true. I know this sounds crazy but a retired federal person told me that a person that has a TSP account during retirement can only make withdraws from the total account and not pick funds within the account to withdraw from.

 

In other words If I had 50% bond allocation with the G fund and a 50% allocation with the C fund and asked to make a one time withdraw to make ends meet in a particular year they would take 15,000 from each fund in order to complete my 30,000.00 transaction. Now in a year like this if I didn't want to remove anything from the C fund and lock in a loss I would ask for all the money to come from my G fund. Is that possible or not?

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Valued Contributor

Re: TSP question regarding withdrawing funds

See links for new rules,   https://www.tsp.gov/whatsnew/Content/index.html#newoptions

Summary of changes   https://www.tsp.gov/PDF/formspubs/tspfs10.pdf

Seems that you can choose whether withdrawals come from regular or Roth TSP or both; you can indicate $amount or % of account. But then no other choices are indicated - so money comes out proportionally.

Of course you can change allocation before starting the withdrawal [or during the withdrawals].

You can also rollover/direct-transfer to T-IRA and R-IRA where you don't have many restrictions.

 

YBB
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Follower ○○○

Re: TSP question regarding withdrawing funds

Thanks Yogi. I read the information also. It's unacceptable to me the way it has been set up that a TSP investor can't pick and choose which fund you withdraw from during retirement. So if you wanted to just withdraw money from G fund you would have to change your entire tsp portfolio to be 100% G fund. Then make your desired withdraw. After that takes place you could then put your money back in the desired funds. Otherwise if you wanted say a 30,000.00 withdraw under TSP way of doing things you would be taking the 30,000.00 out of each fund that you own. So at a time like this with all the market swings who knows what could happen. 

There isn't a doubt in my mind when I retire I will be rolling over my entire TSP account to Vanguard or T.Rowe Price with a horrible situation like that to deal with. Then I can put the TSP money in any funds I desire and make withdraws from which ever funds I desire when necessary. That's how it should be at TSP also, but I guess it's not. 

 

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Follower ○○

Re: TSP question regarding withdrawing funds

My wife was in the TSP for 30 years and we moved her to Fidelity a couple months ago. After she retired we wanted more flexibility and options.  

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Explorer ○○○

Re: TSP question regarding withdrawing funds

 

Sure, there are reasons.    But look at relative expense and might remain TSP.

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Follower ○○○

Re: TSP question regarding withdrawing funds

The TSP is VERY low cost and has the 'feature' of the G Fund which bogleheads like, it is a stable value fund, low  returns but essentially no risk. But the TSP is not very flexible on withdrawals. What I did, and I know a number of others, I tok part of my TSP (25% in my case) and rolled it over to a Vanguard IRA so I could invest in things not covered by the TSP (foreign bonds (ugh), REITs, Preferreds...) and I can take QCDs from this account. I left all my TSP $ in the G fund and addressed other parts of my asset allocation in the VG IRA and taxable investments. The G fund was a way to retain a little sanity over the last couple weeks.

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