Distribution technical question

[croaker251]

I currently receive $2500.00 in monthly distributions. If I am 25% C, 25% F, and 50% G is the distribution taken from each fund based on my percentages? Also if I were to do an IFT where I increase my C to 50% and decrease my G to 25% is that a movement directly from G to C based on the daily price?

[crondanet5]

croaker the easiest and most appropriate thing for you to do is call TSP and ask them how it works. Does your $2500 monthly distribution include money for federal and state tax withholding or do you add that amount onto the $2500 that is sent to you? If the taxes are added onto the $2500 you must actually be withdrawing about $4,000 a month. Will you run out of money downstream?

[croaker251]

Thought this would be an easy one for this forum's brain trust. This was not a tax question or a concern about out living my TSP.

[tspforlife]

I know the answer to one of your questions. You can call TSP about the other question. The monthly amount removed from each is based on your current % for each you're invested in: For example on the day tsp withdraws the $2500 if C is 25.2% - F 24.9 and G 49.9% are your current percentages that is the % of each deducted...

[crondanet5]

croaker, we can make a guess at what we think the TSP computer withdraws from your account, but only a TSP counselor can tell you what really happens. While not probing for information about your TSP account, let me say I'm concerned that you have 50% of your account outside the G Fund. If your account is large the G Fund should give you a good annual return and protect you from a market downturn like we just went through. And if there is another reason you are withdrawing that much a month from your TSP the C and the F Fund allocations could reduce the overall amount you get to withdraw while depleting your TSP account. There are some who say this market is still headed down and this is a short term bounce. This is all conjecture on my part and I'm not trying to pry. Rather, I'm presenting to you and the tspcenter community the idea of protecting your account when you begin making withdrawals from it. My theory is the TSP account balance should increase despite your withdrawals. These days I doubt that is possible keeping your money inside the TSP Program. There are alternatives.

[Tomanyiron]

Thought this would be an easy one for this forum's brain trust.

You came to the wrong place if you thought we had all the answers. We help where we can, sometimes someone has had a similar thing happen to them and can give an answer. But you got to have patience until the right guy sees your post.

[tspforlife]

Croaker251, I gave you the right answer to one of your questions...

[croaker251]

Thanks for the answer. I should have specified my example is hypothetical. While I like the safe harbor of the G fund, I retired at 55 and still view myself as a long term investor. While 9/11 was a setback, I stayed the long view course buying on the lows and it paid off. Was on the sidelines in 2008 so no loss and small gains. My current TSP.gov PIP is 9.40%. My $2600.00 before taxes distribution is 3% of my total.

[crondanet5]

Let me get this straight. You are withdrawing 3% of your total TSP account balance per month and not having the taxes withheld on that amount?

[skiehawk11]

I'm concerned about your drawdown if you're withdrawing 3% of your total balance a month. You'll effectively deplete your TSP balance within 3 years.