Question 1
Can I stop receiving withdrawals from my TSP after I start? For instance I was thinking of filling the “gap” between FERS supplemental and social security with my TSP but then stopping or lowering withdrawal amount from TSP? Also, does my TSP continue to grow even if I am taking withdrawals? Thanks
Answer 1
Yes, you are able to stop TSP withdrawals at any time and many people do take more from their TSP between when the FERS Supplement stops and when they start Social Security.
Also, your TSP can continue to grow even when you are taking withdrawals. But it will be up to you to pick an investment mix that makes sense for you in retirement.
This article walks you through a great retirement investment strategy.
Question 2
Good day. I’ve heard someone say to stop putting anything above the matching percentage in TSP and use that money for a cash value life insurance policy. That way when it’s time to retire, you can take that cash value amount out without being taxed. Is this a good move to make? My concern would be that my monthly premium would increase as I got older. Thx!
Answer 2
To cut to the chase, using life insurance as retirement savings or investments is rarely a good option.
To put it bluntly you will make the life insurance company (and the agent who sold you the policy) a lot of money and it will be an okay-ish investment for you.
If you want to most bang your buck the TSP is a great place to invest.
Question 3
What happens when you turn 65 and Medicare kicks in, with a wife who is younger and you have minor children?
Answer 3
Medicare covers only those (most of the time) that are 65 and older. So if you get on Medicare and your spouse and kids aren’t 65 then Medicare will only cover you.
So you will want to make sure you have a FEHB plan that covers their needs well enough. And once your spouse turns 65 they’ll be able to get on Medicare as well.
