TSP
Distribution
GUARANTEE

MetLife offers annuity options through the Thrift Savings Plan (TSP) Annuity Program. The TSP annuity options provided by MetLife are designed to provide a stream of income during retirement based on the funds accumulated in your TSP account. Here’s an overview of how MetLife’s annuity options work within the TSP framework:

Annuity Options: MetLife offers several types of annuities that you can choose from when you decide to convert your TSP savings into a guaranteed income stream:

Single Life Annuity: Provides payments for your lifetime only.
Joint Life Annuity: Provides payments for your lifetime and, if elected, for the lifetime of a beneficiary (such as a spouse).
Annuity with a 10-Year Certain Period: Provides payments for your lifetime with at least 120 monthly payments guaranteed.
Guaranteed Income: Annuities offered through the TSP Annuity Program with MetLife provide a guaranteed income stream, which can help ensure financial security during retirement. The amount of income you receive depends on factors such as your age, the annuity option selected, and the amount of funds transferred from your TSP account.

Tax Considerations: Income received from annuities may be subject to federal income tax. The tax treatment depends on whether contributions to your TSP account were made on a pre-tax or after-tax (Roth) basis. Consult with a tax advisor to understand the tax implications of annuity payments from your TSP account.

Flexibility: While annuities provide a steady income stream, they typically offer less liquidity compared to other TSP withdrawal options like lump-sum withdrawals or systematic withdrawals. It’s important to consider your liquidity needs and financial goals before choosing an annuity option.

Purchasing Annuities: When you elect to purchase an annuity through the TSP Annuity Program with MetLife, you transfer a portion or all of your TSP account balance to MetLife. The transferred funds are then used to purchase the selected annuity option, which determines the amount of income you will receive.

Annuity Rates: The income payments you receive from an annuity are based on current annuity rates at the time of purchase. Annuity rates can vary based on market conditions and interest rates.

Note: The Single Life Annuity doesn’t include survivor benefit.

1. Single Lump Sum: You can withdraw your entire TSP account balance in a single lump sum. This option may have tax implications, including withholding taxes, and could potentially push you into a higher tax bracket for that year.
2. Series of Monthly Payments (Systematic Withdrawals): You can choose to receive regular monthly payments from your TSP account. This can be based on a fixed dollar amount or calculated based on life expectancy. This option provides regular income while keeping the remaining funds invested.
3. Annuity Options: TSP offers annuity options through its annuity providers. An annuity provides a steady income stream for life or a specified period, with payments guaranteed by the annuity provider.
4. Partial Withdrawals: You can make partial withdrawals from your TSP account, either as a lump sum or periodic payments, while keeping the remaining funds invested in the TSP.
5. Transfer or Rollover: You can transfer or roll over your TSP account balance to an Individual Retirement Account (IRA) or another eligible retirement plan to continue tax-deferred growth and potentially access different investment options.

1. Federal Income Tax: Withdrawals from a TSP account are subject to federal income tax in the year they are withdrawn. The amount withdrawn is added to your taxable income for that year.
2. State Income Tax: Depending on the state you reside in, withdrawals may also be subject to state income tax.
3. Withholding Taxes: TSP withdrawals are subject to mandatory federal income tax withholding. The amount withheld depends on the type of withdrawal and your instructions.
4. Early Withdrawal Penalty: If you withdraw funds from your TSP account before age 59½ (or before separation from service if later), you may be subject to an additional 10% early withdrawal penalty, in addition to regular income taxes.
5. Roth TSP: If you have contributions in a Roth TSP account, qualified distributions (including earnings) are tax-free if certain conditions are met, such as being age 59½ or older and having the Roth TSP account open for at least five years.

• Financial Planning: Careful planning of withdrawals can help minimize taxes and penalties.
• Retirement Income Strategy: Consider how withdrawals fit into your overall retirement income strategy, including Social Security benefits and other retirement accounts.
• Consultation: It’s advisable to consult with a financial advisor or tax professional to understand the specific implications of TSP withdrawals based on your individual circumstances and financial goals.

This chart explains how you can guarantee the money in your TSP plan. Qualified indexed IRA accounts allow you to carry out a partial or total Rollover of your retirement plan without paying contributions for the rollover to protect your balance from market losses. This Rollover does not limit your participation in profits from the S&P500 market since this fund is used as a guide so that your IRA account receives participation in these profits. On the other hand, it guarantees 100% of the principal and the profits that accumulate every year. You can withdraw these Earnings every year without touching the principal or a 10% annual free withdrawal of the total value of the account.

Choosing the distribution alternative offers you the certainty that you will receive the same amount of income annually even if the initial balance is consumed. It is important to know that in this alternative the first thing that is distributed is the transferred principal and after the principal is finished, the company chosen will be responsible for continuing to distribute the money until 100 years of age. This distribution option comes in most cases with annual administrative costs that are deducted from the funds contributed. After accepting this alternative, it is important to know that it is irrevocable and that it is an exchange of the balance for a permanent distribution.

Managing your Thrift Savings Plan (TSP) can be complex, but numerous resources and support options are available to help you navigate your retirement savings plan. Here are some frequently asked questions (FAQs) and answers to guide you: