TSP WD during retirement process

[GS850-12/10]

So I got a memo this week saying TSP withdrawals as well as FERS interim payments will not be made to me until after my HR sends over the retirement package. I'm planning on retiring Dec 31, '25 and given the very short staffed HR, I anticipate at least 6 months before I can withdraw TSP or get the interim payments. I don't want to withdraw now since my 2025 income is already high and adding TSP money to my income will raise my 2025 income taxes. Anyone know if TSP has some mechanism where I can start withdrawing before they get my retirement notification from HR? Thanks in advance.

[mjedlin66]

So I got a memo this week saying TSP withdrawals as well as FERS interim payments will not be made to me until after my HR sends over the retirement package. I'm planning on retiring Dec 31, '25 and given the very short staffed HR, I anticipate at least 6 months before I can withdraw TSP or get the interim payments. I don't want to withdraw now since my 2025 income is already high and adding TSP money to my income will raise my 2025 income taxes. Anyone know if TSP has some mechanism where I can start withdrawing before they get my retirement notification from HR? Thanks in advance.

Fellow 0850 here.

I am not super well-versed in retirement, because I'm still working. But I have always understood that you are eligible for TSP disbursements "almost" immediately. Your local HR sending your retirement package to OPM is what I think they are referring to. OPM is the process that takes forever. I would expect local HR to do their part relatively quickly. Also, you will cash out all of your annual leave on your retirement date, and hopefully that should cover you for a month or two.

[GS850-12/10]

Hi Fellow 850,

Here's the exact quote from the memo regards TSP.
"Thrift Savings Plan (TSP) & TSP Loans: You will maintain your TSP account after retirement but cannot contribute any personal funds to it. If you choose to withdraw or transfer funds, please wait 6-8 weeks after separation so payroll can notify TSP you have separated."

And here's the part about unused annual payout.
"Your unused annual leave will not be included in your last paycheck.
It will be paid out 6-8 weeks after the end of the pay period in which you separated."

So again, given my local HR has been cut to the bone and folded in with the DOI in DC, I'm of the opinion that it'll be near the middle of 2026 before I can access TSP or get a annual leave payout. Thank you.

[Bubba]

Sorry you're going through this process. My belief is that things are going to be bad (potentially worse) for a bit longer. On the good side, I'm not sure you ever got a note telling you that you were "overpaid" and while you received nothing in pay, you must now pay the government money back...for the benefit of working.

I guess we get to see everything at least once?

I know this doesn't answer your question, but things are tough. I am hoping things go well for you though.

[Jimmyk65]

GS-0850-
I retired in March 12 of this year. From your quoted memo, ""Thrift Savings Plan (TSP) & TSP Loans: You will maintain your TSP account after retirement but cannot contribute any personal funds to it. If you choose to withdraw or transfer funds, please wait 6-8 weeks after separation so payroll can notify TSP you have separated."
That is how it worked for me. It took OPM some time to officially declare me separated before I received any pension payments. It also took some time for them to notify TSP before I could roll funds out of TSP. In my case, I received my first interim payment June 2nd which was about half my pension and no fers supplement. In July they paid supplement and started taking taxes and health insurance premium. August, they made some adjustments to pension, and by September everything was squared away. I was able to roll funds out of TSP into an IRA by May 5, 2025 (about 2 months).

Like you I was expecting minimum 6 month wait times. This went better than expected. Partially, I think because my original HR person didn't submit my paperwork to OPM the first month after I retired, and then the HR person (I called) that took over my case expedited it. She was really on the ball.

[gbnooks207]

1) Set up a Traditional IRA account outside of TSP
2) In the Financial Institutions section of TSP website, set up a Rollover Institution. Read the information required to do this.
3) Transfer to outside account and take money out from them as you need.
I have transferred twice already this way for my future retirement at the end of November

[Jimmyk65]

Gbnooks makes a good point. Set up IRA accounts and link account to tsp. This takes about seven days before you can move funds.