changing TSP allocation in retirement

[actortype]

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Excuse my ignorance, but I did look over the TSP site a bit before this first post.

When you retire and choose to take the TSP in monthly chunks (that will take more than 10 years to exhaust your account so as to avoid upfront taxes - I think) can you reallocate the balance among the TSP funds? If so, how often....daily, monthly, yearly?

Can someone point me to the chapter and verse that spells this out?

Thanks

 

[tsptalk]

imported post

actortype wrote:

Excuse my ignorance, but I did look over the TSP site a bit before this first post.

When you retire and choose to take the TSP in monthly chunks (that will take more than 10 years to exhaust your account so as to avoid upfront taxes - I think)

Welcome actortype! I don't believe you avoid the taxes that way, but if you are under 59 1/2 you avoid the early withdrawal penalty. Someone correct me if I'm wrong here.

can you reallocate the balance among the TSP funds? If so, how often....daily, monthly, yearly?

Yes, Daily. Any transfers made before noon ET will be effective the following business day.

Can someone point me to the chapter and verse that spells this out?

I would peruse http://[url]www.tsp.gov[/url]. The site seems to be down currently otherwise I'd find the page and put the link here.

Hope that helps. thanks for joining us!

 

[actortype]

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Thanks for the reply. I miss spoke (typed) about taxes and meant of course the early withdrawal penalty. A fellow employee about to retire "thought" one had to select TSP funds and stay that allocation upon retirement. Didn't sound right to me. the ability to "buy and sell" your TSP funds at will has to be a great advantage over other more cumbersome arrangements. Though it can be too easy for the reactionary.

I'll go back and reread the forms I printed from the TSP site on retirement to try and locate a statement that verifies the "reallocation freedom". If anyone knows which one, thanks ahead for letting me know.

 

[tsptalk]

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actortype wrote:

A fellow employee about to retire "thought" one had to select TSP funds and stay that allocation upon retirement. Didn't sound right to me. the ability to "buy and sell" your TSP funds at will has to be a great advantage over other more cumbersome arrangements. Though it can be too easy for the reactionary.

Please let us know if I am wrong on that one.

Thanks,
Tom

 

[actortype]

imported post

Tom and all:

According to a service rep on the Thrift Line (877-968-3778), one can make interfund transfers any business day as long as there are shares in one's account - as a an employee or retiree.

And, as makes sense, if you have a dollar amount withdraw every month in retirement,it is taken from each of the funds in your current allocation by the percentages you have selected, i.e. 30% C, 40% S, 30% G.

So now I know, an maybe some others learned too. Thanks for the interest.

Actortype

 

[tsptalk]

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Thanks for the follow up!!