• Question
  • Thrift Savings Plan Withdrawals -- Maintenance Worker - Retire from FERS

    Asked on 11/4/2012

    can i withdrawl my 401k at 59 1/2 and withdrawl the rest of it out when i retire from the government i am with FERS

  • Categories: Thrift Savings Plan - TSP, Pensions and Retirement Benefits


  • Editorial 


    San Francisco, CA

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  • According to this handbook: http://www.opm.gov/forms/pdfimage/ri90-1.pdf

    The FERS program is a three tiered retirement plan with:
    - Social Security Benefits
    - a Basic Benefit Plan
    - Thrift Savings Plans (TSP)

    When you refer to your 401k, are you referring to your Thrift Savings Plan? For this answer, I will assume yes.

    The TSP is a tax-deferred retirement savings and investment plan much like 401ks offered by private corporations. The above-mentioned FERS handbook suggests that you must separate from Federal service to withdraw from your TSP. And, there are three basic ways to withdraw your account:
    -- Have the TSP purchase a life annuity for you.
    -- Receive your account in a single payment.
    -- Receive your account in a series of monthly payments.

    So, I do not think that you can withdraw from your TSP at 59 1/2 if you are still working for the government.

    However, perhaps you do have a 401k from a previous private employer. If this is the case, then that account is subject to the rules for 401ks and you would be eligible to make withdrawals at age 59 1/2 without tax penalties. And you could withdraw the remaining when you retire.

    I hope this information is useful. Were you able to use the NewRetirement Calculator? It should have given you additional insight into when you might run out of money in retirement, what risks you might consider and more. http://www.NewRetirement.com

    Additionally, you might benefit from a free retirement consultation with a financial advisor. https://www.newretirement.com/free-retirement-consultation.aspx

  • Login to rate this answer:   Answered on 11/8/2012
**All above answers are provided as general information only. No warranty is made regarding the fitness or accuracy of the information provided in this answer. You should seek advice from a licensed CPA, attorney or CERTIFIED FINANCIAL PLANNER™ as to your unique financial situation.