TSP

The TSP just posted a March 2019 update of the Summary of the Thrift Savings Plan on their website. It’s accurate until September 15th. But, it doesn’t discuss the changes that are coming on that date due to the implementation of the TSP Modernization Act. If you decide to download the Summary, read it with a copy of this article, which summarizes the changes, close at hand.

Through 9/14/2019

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Age based withdrawals: Only one age-based withdrawal is allowed for employees who have attained the age of 59 ½. Taking an age based withdrawal will preclude the participant from taking a partial withdrawal when separated.

Partial withdrawals when separated: If a separated participant has not taken an age based withdrawal while working, they are allowed to take only one partial withdrawal after they have separated. After a partial withdrawal has been taken, only one full (final) withdrawal is allowed.

Monthly payments: Once a separated employee begins taking monthly payments, they cannot stop unless you “cash out”. There is an annual open season where they can change the amount of the payment. One is not allowed to take a partial withdrawal once they have begun taking monthly payments.

Proportional withdrawals: For those who have both traditional and Roth balances in their TSP, all withdrawals must be taken proportionally between the two balances.

9/15/2019 and later

Age based withdrawals:  Up to four age based withdrawals per year are allowed for employees who have attained the age of 59 ½.  Taking an age based withdrawal will no longer preclude the participant from taking a partial withdrawal when separated.

Partial withdrawals when separated:  Whether or not a separated participant has taken an age based withdrawal (or withdrawals) while working, there is no limit to the number of partial withdrawals they can take, as long as they are not taken more often that every thirty days.

Installment payments:  Installment payments can be taken monthly, quarterly or annually.  The amount and frequency of installment payments can be changed at any time.  Payments can be stopped and started at any time.  Taking installment payments will not preclude one from taking partial withdrawals.

Proportional withdrawals are no longer required.
Individuals will have the option of choosing from which balance (traditional or Roth) they want their withdrawals to come.

See also: TSP Rules on Spousal Rights