TSP access: "In the year you turn 55".....if I retire prior to 55......

[jazaddict]

ATC FERS.
I'm looking for some clarification on TSP withdrawl options. If I retire prior to age 55, are TSP lump funds available to me with NO 10% penalty when I reach age 55? Or do I have to work until and retire at age 55 (or later) to bypass the 10% penalty?

When I read "...retire in the year you turn 55" it sounds like if I retire at 52, I wait til I'm 59.5....but if I work til 55 I can access the lump funds then penalty free.

I'm so jonesin' to retire I just might eat the 10% anyway.......but I do wanna know.

 

[clester]

Re: TSP access: "In the year you turn 55".....if I retire prior to 55......

ATC FERS.
I'm looking for some clarification on TSP withdrawl options. If I retire prior to age 55, are TSP lump funds available to me with NO 10% penalty when I reach age 55? Or do I have to work until and retire at age 55 (or later) to bypass the 10% penalty?

When I read "...retire in the year you turn 55" it sounds like if I retire at 52, I wait til I'm 59.5....but if I work til 55 I can access the lump funds then penalty free.

I'm so jonesin' to retire I just might eat the 10% anyway.......but I do wanna know.

You have it right. You could take a partial withdrawal, pay penalty and then get monthly payments based on life expectancy, wait till 59.5 and then take out the rest.