Dave Befort and Paul Fugere drop in to discuss how to immediately withdrawal up to $100k PENALTY FREE from your TSP account.

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Thrift Savings Plan (TSP) is a retirement savings plan for federal employees and military personnel that offers many benefits, including tax advantages and low-cost investment options. However, one of the lesser-known benefits of TSP is the ability to make penalty-free withdrawals under certain circumstances.

According to the TSP website, there are specific scenarios where participants can withdraw money from their TSP account without incurring the usual 10% early withdrawal penalty fee. These include:

1. Separation from Service: If you leave your federal job or retire in or after the year you turn 55, you can withdraw money from your TSP account penalty-free.

2. Age-based withdrawals: Once you turn 59 and a half, you can make penalty-free withdrawals from your TSP account.

3. In-Service Withdrawals: TSP participants who are still working for the federal government can make an in-service withdrawal without penalty once they reach the age of 59 and a half.

4. Death: If a TSP participant passes away, their beneficiaries can withdraw from the account without penalty.

It’s important to note that while these withdrawals may not incur the 10% penalty fee, they may still be subject to income taxes. It’s always a good idea to consult with a financial advisor or tax professional before making any withdrawals from your TSP account.

Additionally, participants can take a loan from their TSP account and use the money for any purpose. However, the loan must be repaid with interest, and failure to repay the loan can result in taxes and penalties.

In conclusion, the Thrift Savings Plan offers many benefits, including the ability to make penalty-free withdrawals under certain circumstances. However, it’s important to be aware of the rules and regulations around these withdrawals and to consult with a financial advisor or tax professional before making any decisions regarding your TSP account.