Thread: Age 56

Originally Posted by mpillis

I want to retire at 56 which is my MRA. I will have 36 years of service. Can I begin withdrawing from my TSP account without penalty or do I have to wait till I am 59 and 1/2?
I want to go at 56 damnit.

No, you don't have to wait until 59 1/2 IF you are retired and separated from the government.

Go for it!

Lady

From TSP's Important Tax Information About Payments From Your TSP Account

Additional 10% penalty tax if you are under age 59½

If you receive a TSP distribution before you reach age 59½, in addition to the regular income tax, you may have to pay an early withdrawal penalty tax equal to 10% of any portion of the distribution not transferred or rolled over. The additional 10% tax generally does not apply to payments that are:

• Paid after you separate from service during or after the year you reach age 55;
• Made because you are totally and permanently disabled;
• Paid as substantially equal payments over your life expectancy;
• Annuity payments;
• Ordered by a domestic relations court;
• Made because of death; or
• Made in a year you have deductible medical expenses that exceed 7.5% of your adjusted gross income.

I just retired at 60 because I didn't want to take a hit withdrawing before 59.5 years.
Note also that retiring at 56 you will have to wait till you are 62 for a COLA on your FERS annuity and your SS supplement. So there are some pretty serious hits that happen before you hit that 62 mark as a FERS retiree and before 59.5.
With 36 years in some of your time may be CSRS and that portion of your pension will receive a COLA annually.