Categories: Fedweek

Monthly Payments Policy Changing

One other change in withdrawal policy affects the “substantially equal” monthly payments option. Currently, investors may choose one of three types of such withdrawals, based on a dollar amount per month, a number of months to draw down the account balance, or life expectancy-based payments calculated according to actuarial tables. After the changeover, the TSP will no longer allow withdrawals based on a number of months. However, unlike the current policy, dollar amount based withdrawals will be changeable, as often as once a year. Also, there will be a one-time opportunity for someone taking a life expectancy-based monthly withdrawal to change to a dollar amount-based withdrawal.

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