Convert tsp balance to roth
Posted on Monday, 21st January 2013 by Dennis Damp
I discussed the advantages and limitations of TSP ROTH conversions in my last column. THRIFT Plan participants are currently prohibited from converting their traditional TSP accounts to a ROTH. Changes may be on the way that will allow you to convert part of your TSP to a ROTH.
Many readers have expressed interest in converting some of their TSP to a ROTH and currently only new contributions from plan participants can be invested in a ROTH. However, there are currently several options to transfer funds from your account, if eligible, that could be used to fund a private sector ROTH. Federal employees that are age 59 ½ can make a onetime lump sum in-service withdrawal from their TSP account while they are still actively employed in Federal civilian service or the uniformed services. There are two types of in-service withdrawals: financial hardship withdrawals and age-based withdrawals. Retirees can take a onetime lump sum withdrawal or transfer the entire account to fund a ROTH if desired.
Hopefully the TSP will afford us the opportunity to convert at least a portion of our current TSP account to a ROTH in the near future. For more information on investing for retirement use our comprehensive Financial Planning Guide.
Recent Forum Host Articles:
Request a FREE Retirement Benefits Summary & Analysis from a local adviser. A sample analysis is available for your review. Includes projected annuity payments, income verses expenses, FEGLI, and TSP projections. This service is not affiliated with www.federalretirement.net.
Learn more about your benefits, employment, and financial planning issues on our site and visit our Blog frequently at http://fedretire.net to read all forum articles.
Visit our other informative sites
- 2013 Excel Leave Chart (target 2013 retirement dates and determine exact leave balances for each date)
- How to be Emotionally and Physically Prepared When You Retire
- How to be Financially Prepared When You Retire
- Master Retiree Contact List (Important contact numbers and information)
- Survivorâs Guide
- Estate Planning Guide (An 11 part series that will help readers prepare for retirement, understand basic estate planning techniques, and compile their personal âSurvivorâs Guideâ binder.)