Thrift Board Shares Changes to TSP Withdrawal Options

The Thrift Board shared details about future TSP withdrawal options at a joint Thrift Board Members-Employees Thrift Advisory Committee (ETAC) meeting, of which NTEU is a member.

604px-us-thriftsavingsplan-logo-svg_As you may recall, the TSP Modernization Act (PL 115-84), which passed in November 2017, authorized the Thrift Board to make changes in withdrawal options from the TSP. The changes will allow multiple age-based in-service and post-separation withdrawals. Currently, participants can make one partial withdrawal and after that, the only option is a full withdrawal of your funds. The Thrift Board will also allow individuals to choose whether the withdrawal should come from their Roth balance, the traditional balance, or a proportional mix of both.

In addition, there will be a change in the post-separation installment distributions from your account. Now, the only option is monthly payments. The new rules will allow you to receive payments quarterly or annually, in addition to monthly. Also, when the new regulations are promulgated, participants will be able to change the amount of the monthly payment at any time, not just during an open season. In addition, the new rules will eliminate the requirement that if you stop your monthly payment, you must take out the rest of your TSP funds.

The Thrift Board hopes to implement this new system by September 2019. I will keep you updated on its progress, but I feel they have listened to many of the concerns that NTEU National President Tony Reardon forwarded to them from NTEU members. You can find more detailed information on the TSP website at https://www.tsp.gov/PDF/formspubs/tspfs10.pdf.

Author: chapterpresident

I have worked in the FDA since 1990 in a variety of positions. I currently serve as chapter president of NTEU Chapter 254, representing FDA employees in Arkansas, Colorado, Iowa, Kansas, Missouri, Nebraska, New Mexico, Oklahoma, Texas, and Utah.

One thought on “Thrift Board Shares Changes to TSP Withdrawal Options”

  1. They ought to allow withdrawals from specific Funds, say Fund G, or Fund C. Else one is forced into overly conservative investing, which does not keep up with inflation too well, unless one plans on croaking early.

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