Archive for month: April, 2019

A surviving spouse is the only survivor that can leave inherited funds in the Thrift Savings Plan (TSP). It is very common for a federal employee to tell their spouse to leave the funds in TSP should the spouse survive the federal employee spouse.

Let me share an example of how a hypothetical conversation between a couple may go.

Meet Christopher and Angelica

Angelica dear, in the event I predecease you, just leave my retirement money in the Thrift Savings Plan (TSP). It is low cost and you can leave it invested as it is now, in the L income fund. Make sure to name our children, Harry and Danielle, as your beneficiaries so they will eventually inherit these funds when we both have passed.

Christopher’s TSP

Christopher was taught by his wise grandfather as a young lad, that to be financially dependent, he needed to start saving and investing early on.

As soon as he graduated from college and secured employment with the government, he diligently contributed the maximum allowed into his TSP account each year. Christopher allocated his TSP funds within his comfort level and did not panic when the stock market took a downturn.

At retirement, Christopher had accumulated $1.2 million in this TSP account. During retirement, he withdrew less than 4% to supplement their income need.

Christopher’s TSP continued to grow and had reached $1.4 million when he passed at age 86.

Follow link to read more important information about TSP Beneficiary Participation Accounts.
 https://www.fedsmith.com/2019/04/03/understanding-tsp-beneficiary-participation-account-works/.