U.S. Marine Corps photo by Sgt Bobby Yarbrough) (This image was manipulated using filters.)
If you have a Federal Thrift Savings Plan (TSP), you probably signed up for it at the start of your military career, and know that a percentage of your monthly income contributes to your TSP retirement plan. But since it’s always been that way, you probably haven’t thought much about your TSP since setting it up.
Now you’re transitioning. You’re considering all your military retirement options, but, do you know how much you’ve even saved for retirement? Are you aware of your TSP rollover options, and whether you should move to an employer 401(k) plan, IRA, or cash your TSP out? Do you even understand what all these acronyms and numbers mean?
Don't’ worry! We’ve put together some actionable TSP retirement advice to answer all your questions about thrift savings plan withdrawal, and how to decide whether to cash it out or not.
What is the TSP Retirement Plan?
The Federal Thrift Saving Plan (TSP) is a special type of Individual Retirement Account (IRA) maintained by the federal government and offered to the military and other federal employees.
Along with their 20-year pension plan, military service members can use the TSP as an alternate or supplemental retirement plan. The TSP military retirement plan is a good deal, because the federal government pays the administrative costs of the plan, so your money is never subject to fees for trading, account transfers, or anything else. So, the Thrift Saving Plan is basically a free IRA for service members!