Retirement and my TSP

[DMcKenna]

Hi, I'm a FERS Retiree, age 60 and getting a lot of pressure to move my TSP account to a Finan
cial Co. I have some other accounts with. I love the TSPs low costs and have built a nice nest egg. Just not sure of the best way forward in retirement. I read a lot on both thoughts on this. Looking to learn as much as I can.

 

[exnavyew]

Here's one resource, Good Luck!

https://www.fedweek.com/

 

[Jackbnimble]

Welcome to the forum.

Low expenses and the G fund pays almost 3% now with no loss of principal. That's hard to find outside the TSP. And the older I get the more I will allocate over to the G fund. I plan on using the TSP for the duration of my life, or until I have drawn it down.

Also anytime I feel "a lot of pressure" to do something I take a hard look and see what motivates everyone. I think I know what motivates the financial company. I guess if the other accounts you have with this company have routinely outperformed the TSP funds, then the question you have to ask is do you think that will continue If they haven't done as well as the TSP, then I would have to question your motive.

 

[evilanne]

The financial advisor will generally charge a small percentage of the total value of your account on an annual basis if you have a "managed account" and will probably put it in typical investments/mutual funds, stocks and/or bonds and maybe they will review it once a year which means they will increase their income. If you are happy with TSP and like managing it yourself, I would definitely stay with TSP and tell them you are not interested in transferring anything. If there are things you would like to invest in that are not available in TSP, you might want to consider a partial roll over at some point. Just make sure you ask about and understand their fee structure beforehand.

 

[Cactus]

My reaction to pressure like that is to pull what I accounts I do have with them and go somewhere else. I'm 59 and still working but have grown tired of the sales pitches, broken promises and excuses. They are just someone else who want to stick a straw into your life savings and suck out as much of it for themselves as they can.


To be fair, FRTIB is also unusually interested in us keeping our money in the TSP after we retire. Why should they care? It's not like they get paid by the amount under management.

 

[James48843]

Hi, I'm a FERS Retiree, age 60 and getting a lot of pressure to move my TSP account to a Finan
cial Co. I have some other accounts with. I love the TSPs low costs and have built a nice nest egg. Just not sure of the best way forward in retirement. I read a lot on both thoughts on this. Looking to learn as much as I can.

If you are happy with your current investment mix, keep it . The ONLY reason you should move money from the TSP and stick it someone else, is if you are concerned that your money isn't getting the exposure it needs to make the most in some sector. For example, if you wanted to have a "Precious metals" component to your savings for retirement, or a Real Estate REIT, both of which are not currently available through the TSP, well, that could be an option to move some of your money.

But other than that, I can't really see a reason to move it away from TSP.

Again- if you are "getting pressure to move it", then ask WHY. Odds are you are getting "pressure" only because an investment broker wants to make money from you.

Good luck

 

[exnavyew]

I haven't talked to TSP yet but it looks like they withhold 20% for taxes on age-based withdrawals. However it seems that if I roll it over to an IRA no funds are withheld. Any feedback or related links are welcome! :smile:

 

[evilanne]

What do you mean by age based withdrawals? There is an in-service age based withdrawal, which means you are still working https://www.tsp.gov/PDF/formspubs/tsp-536.pdf. You are going to pay taxes at your marginal income tax rate for any money that is distributed to you. If you are under 59.5 you are going to have to pay an additional 10% penalty on the distributions. Depending on the amount, if you don't withhold anything, you may end up with a penalty when you file your taxes. Unless they have updated their rules, you only have one partial withdrawal available, so weigh your option carefully. https://www.forbes.com/sites/adviso...ent-penalty-and-how-to-avoid-it/#584a43054025