TimeRunner wrote:July 2015 FRTIB minutes have been published. Of most interest to me is Agenda Item #4:
"4. Withdrawal Options.
Mr. Long discussed the memo, "TSP Withdrawal Options" (attached), which recommends the Board's approval of additional flexibility to make partial withdrawals from TSP accounts, both in-service and post-separation. These recommendations address the challenge of a large percentage of recently separated participants taking full withdrawals as well as feedback from participants requesting greater flexibility. The proposed rules - specified on pages 4 and 5 of the memo - would allow for multiple partial in-service and post-separation withdrawals, where the current rules allow for only one. In response to a question from Board Member McCray, Mr. Long noted that participants currently have the ability to withdraw all of their money and take it elsewhere, so there is little downside to allowing them to withdraw part of their money more than once. He also stated that the purpose of the recommended rule changes is to improve outcomes for participants who are currently moving their money to plans with less advantageous designs because they are unable to make multiple withdrawals from their TSP accounts. · Mr. Long explained that these changes would require legislation followed by an Agency project, so this is not an immediate change. Board Members Jasien and McCray emphasized the importance of educating participants about the effect of withdrawals on their ability to accomplish retirement goals. Chairman Kennedy, Mr. Long, and Mr. Walther discussed the increased Agency workload that would result from these changes - especially given the interrelatedness between the withdrawal flexibility, mutual fund window, and investment advice - and steps the Agency will take to address this from both budget and project management perspectives.
Chairman Kennedy then entertained a motion regarding withdrawal options. The Board members made, seconded, and adopted the following motion by unanimous vote:
MOTION: That the Agency should proceed with a project to adopt the changes to the withdrawal rules proposed on pages 4 and 5 of the memo titled, "TSP Withdrawal Options," with the understanding that such changes are goals that will require legislation. "
Note that attachments listed at bottom of Agenda minutes PDF are actually links to the attachments and should open for viewing.
Meeting Minutes: http://www.frtib.gov/MeetingMinutes/2015/2015Jul.pdf
Agenda Item: http://www.frtib.gov/pdf/minutes/MM-2015Jul-Att7.pdf
This is certainly good news - thanks for posting! As I'm not quite 62 yet, I can wait a few years if necessary. The lack of withdrawal flexibiliity has been my biggest concern with the TSP.