When Can You Withdraw from TSP Without Penalty?

Shawn Plummer

CEO, The Annuity Expert

Understanding TSP Withdrawal Age

The Thrift Savings Plan (TSP) allows penalty-free withdrawals when you reach the age of 59.5. This aligns with the IRS rules for retirement savings accounts.

Annuity with Guaranteed Lifetime Withdrawal Benefit

Option for Financial Security: Consider an annuity with a guaranteed lifetime withdrawal benefit. This option can ensure a steady income stream, helping manage longevity risk and inflation.

Key Benefits

Never Run Out of Money: Provides financial security throughout retirement.

Inflation Adjustment: Some annuities include features to keep up with inflation, preserving your purchasing power.

Related Reading: When Must I Withdraw from TSP?

TSP Withdrawal Options

AgeWithdrawal TypePenaltyNotes
< 59.5Early WithdrawalYesSubject to 10% IRS penalty
≥ 59.5Standard WithdrawalNoPenalty-free, aligns with IRS rules
Any age after leaving serviceSpecial CircumstancesNoCertain conditions apply

Conclusion

Withdrawing from your TSP at age 59.5 or later avoids penalties, offering more flexibility in retirement planning. Additionally, considering an annuity with a guaranteed lifetime withdrawal benefit can provide financial security and inflation protection. This approach ensures a stable income throughout retirement, allowing for peace of mind.

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Shawn Plummer

CEO, The Annuity Expert

Shawn Plummer is a licensed financial professional, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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