Heads up: LONG rollover TSP to Vanguard

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Heads up: LONG rollover TSP to Vanguard

Post by VictoriaF » Mon Nov 23, 2015 10:22 pm

Today I decided to start the process of rolling over a portion of my TSP to a Vanguard IRA with the goal of making Roth conversions within Vanguard. My excuse for procrastinating was that I was hoping that there would be news from TSP about upcoming in-plan conversions or more flexible withdrawal rules. There was no such a luck. What's worse, I am now at risk of missing the end of the year deadline for Roth conversion.

In order to make a partial TSP withdrawal as a retiree, I had to fill out Form TSP-77. The form is not difficult but it requires:
1. One section to be completed by the recipient of the money, which in my case is Vanguard
2. My signature to be notarized
3. The entire package including the part completed by Vanguard to be submitted at the same time

When I asked a TSP representative about the timeline, her response was:
1. 7-10 business days to process the request
2. 7-10 business days to transfer the money to the receiving organization
==> 20 business days is 4 weeks, and possibly longer considering the holidays

I then called Vanguard and their representative told me:
1. I must start by creating a roll-over IRA account in Vanguard; this can be done online
2. I can send to Vanguard the entire package after I get my signature notarized
3. I must include a letter instructing Vanguard what section I need them to complete, what Vanguard account I want them to use, and to send the completed package to TSP (i.e., not back to me)
4. Vanguard has a long queue of customer requests and my package will not be processed on the day it will arrive
5. Even after the money makes it from TSP to Vanguard, I cannot do Roth conversion online; I have to fill out and send a physical form to Vanguard.

Considering the tight schedule and the holidays, I have prepared and mailed a package to Vanguard a few hours ago. I think I have a good chance to make my rollover and conversion this year, but it's not guaranteed. For those in a similar situation--this year or in the future:

1. Do not wait with rollovers and conversions!
2. UPS Store provides notary service for $5 and next day delivery for $24; they are open in the evening.

Victoria
Last edited by VictoriaF on Mon Nov 23, 2015 10:30 pm, edited 3 times in total.
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Re: Heads up: LONG rollover TSP to Vanguard

Post by LadyGeek » Mon Nov 23, 2015 10:25 pm

This thread is now in the Personal Finance (Not Investing) forum (rollover process).
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Re: Heads up: LONG rollover TSP to Vanguard

Post by Chesterfield » Mon Nov 23, 2015 11:07 pm

It's probably too late now, but if you haven't done a indirect Rollover in the past 12 months, you can do that for this case -- much faster and simpler. You can google/inquire Indirect Rollover -- very simple process and almost instantaneous rollover.

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Re: Heads up: LONG rollover TSP to Vanguard

Post by TimeRunner » Mon Nov 23, 2015 11:13 pm

Can you do an indirect rollover without being subject to 20% tax withholding? That withholding would harsh the time savings!
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Re: Heads up: LONG rollover TSP to Vanguard

Post by OutInThirteen » Tue Nov 24, 2015 1:40 am

VictoriaF wrote:Today I decided to start the process of rolling over a portion of my TSP to a Vanguard IRA with the goal of making Roth conversions within Vanguard. My excuse for procrastinating was that I was hoping that there would be news from TSP about upcoming in-plan conversions or more flexible withdrawal rules. There was no such a luck. What's worse, I am now at risk of missing the end of the year deadline for Roth conversion.

In order to make a partial TSP withdrawal as a retiree, I had to fill out Form TSP-77. The form is not difficult but it requires:
1. One section to be completed by the recipient of the money, which in my case is Vanguard
2. My signature to be notarized
3. The entire package including the part completed by Vanguard to be submitted at the same time

When I asked a TSP representative about the timeline, her response was:
1. 7-10 business days to process the request
2. 7-10 business days to transfer the money to the receiving organization
==> 20 business days is 4 weeks, and possibly longer considering the holidays

I then called Vanguard and their representative told me:
1. I must start by creating a roll-over IRA account in Vanguard; this can be done online
2. I can send to Vanguard the entire package after I get my signature notarized
3. I must include a letter instructing Vanguard what section I need them to complete, what Vanguard account I want them to use, and to send the completed package to TSP (i.e., not back to me)
4. Vanguard has a long queue of customer requests and my package will not be processed on the day it will arrive
5. Even after the money makes it from TSP to Vanguard, I cannot do Roth conversion online; I have to fill out and send a physical form to Vanguard.

Considering the tight schedule and the holidays, I have prepared and mailed a package to Vanguard a few hours ago. I think I have a good chance to make my rollover and conversion this year, but it's not guaranteed. For those in a similar situation--this year or in the future:

1. Do not wait with rollovers and conversions!
2. UPS Store provides notary service for $5 and next day delivery for $24; they are open in the evening.

Victoria
That points out one big advantage to using Fidelity instead of Vanguard - I could print out Form TSP-77, fill it out, take it to a branch of my local bank to sign and have it notarized, then drive a couple of miles to the local Fidelity office to have them complete their portion while I wait to ensure all is well. About an hour from start to finish. Probably even less time would be required - I believe I could have my signature notarized at Fidelity's office and save the trip to my bank! Once Fidelity receives the funds electronically from the TSP and deposits the funds in my existing IRA, I log on to Fidelity's website and complete the Roth conversion in less than a minute. The only uncertain length of time involved is the mailing of the form to the TSP and the TSP's processing time.

If you're worried about missing the deadline, log on to Fidelity's website at your earliest convenience and set up a Rollover IRA online (you can do it as soon as you read this). At your first opportunity, go to the nearest Fidelity office with your Form TSP-77 and you're on your way! If you wanted to, you could set up the Rollover IRA at the same time you drop by with Form TSP-77. You're bound to save a lot of time. Of course this would work best if there's a Fidelity office nearby.

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Re: Heads up: LONG rollover TSP to Vanguard

Post by VictoriaF » Tue Nov 24, 2015 8:31 am

Chesterfield wrote:It's probably too late now, but if you haven't done a indirect Rollover in the past 12 months, you can do that for this case -- much faster and simpler. You can google/inquire Indirect Rollover -- very simple process and almost instantaneous rollover.
I asked TSP how long it would take to send the funds directly to me so that I would forward them to Vanguard myself. They told me that it would take 7-10 days to process and 3-5 days to make a direct deposit into my checking account. This process would have saved 4-5 days in comparison to going through Vanguard, but it would add a few days to transfer money from my checking account to Vanguard.

I had cash to compensate for the taxes that TSP would have withheld, but I preferred to avoid dealing with the associated accounting and figuring out how to get the money back in April. TSP does not withhold state taxes, and I would have to learn about dealing with that, too.

Victoria
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Re: Heads up: LONG rollover TSP to Vanguard

Post by shawcroft » Tue Nov 24, 2015 8:35 am

OutInThirteen wrote:I could print out Form TSP-77, fill it out, take it to a branch of my local bank to sign and have it notarized,
Are you referring to a medallion signature guarantee here? I don't think you need a bank to have your signature notarized.
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Re: Heads up: LONG rollover TSP to Vanguard

Post by VictoriaF » Tue Nov 24, 2015 8:37 am

OutInThirteen wrote:That points out one big advantage to using Fidelity instead of Vanguard - I could print out Form TSP-77, fill it out, take it to a branch of my local bank to sign and have it notarized, then drive a couple of miles to the local Fidelity office to have them complete their portion while I wait to ensure all is well.
This is a good point, especially for those who have a Fidelity office nearby. I don't know if I do, never looked for it, even though I have a Fidelity IRA. Still, the main issue is with the TSP process and with this being a holiday season.

A month ago, the process would have been equally cumbersome but there would be plenty of time to do it. However, my rollover+conversion strategy depends on the TSP policies and I wanted to know if any favorable changes were coming. As it stands right now, I have a single chance for a partial withdrawal, and so I ended up withdrawing the amount I will be converting to Roth over three years (2015, 2016, 2017).

Victoria
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Re: Heads up: LONG rollover TSP to Vanguard

Post by VictoriaF » Tue Nov 24, 2015 8:41 am

shawcroft wrote:
OutInThirteen wrote:I could print out Form TSP-77, fill it out, take it to a branch of my local bank to sign and have it notarized,
Are you referring to a medallion signature guarantee here? I don't think you need a bank to have your signature notarized.
Shawcroft
This is a TSP requirement. In order for them to process your form TSP-77, your signature on page 1 must be notarized. It does not have to be notarized by a bank, in my case it was The UPS Store. However, if you are already in a Fidelity office, they can probably do notary too.

Victoria
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Re: Heads up: LONG rollover TSP to Vanguard

Post by MichDad » Tue Nov 24, 2015 10:50 am

VictoriaF wrote:
OutInThirteen wrote:That points out one big advantage to using Fidelity instead of Vanguard - I could print out Form TSP-77, fill it out, take it to a branch of my local bank to sign and have it notarized, then drive a couple of miles to the local Fidelity office to have them complete their portion while I wait to ensure all is well.
This is a good point, especially for those who have a Fidelity office nearby. I don't know if I do, never looked for it, even though I have a Fidelity IRA. Still, the main issue is with the TSP process and with this being a holiday season.

A month ago, the process would have been equally cumbersome but there would be plenty of time to do it. However, my rollover+conversion strategy depends on the TSP policies and I wanted to know if any favorable changes were coming. As it stands right now, I have a single chance for a partial withdrawal, and so I ended up withdrawing the amount I will be converting to Roth over three years (2015, 2016, 2017).

Victoria
Victoria,

I looked on Fidelity's website and found these branches in the Washington, DC area:

1900 K Street Northwest
Suite 110
Washington DC 20006
Phone: 800-854-2832

1725 Duke Street
Suite GR05
Alexandria VA 22314
Phone: 800-367-1059

7315 Wisconsin Avenue
Suite 150W
Bethesda MD 20814
Phone: 800-531-2419

1861 International Drive
McLean VA 22102
Phone: 800-543-8736

11957 Democracy Drive
Reston VA 20190
Phone: 800-227-0584

1901 Towne Centre Boulevard
Suite 135
Annapolis MD 21401
Phone: 800-544-1441

Good luck with this,

MichDad

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Re: Heads up: LONG rollover TSP to Vanguard

Post by Info_Hound » Tue Nov 24, 2015 11:21 am

I too have done a partial rollover from TSP to my Fido account. The problem I encountered was Fidelity needed to keep the written information inside the little square boxes when they filled out their section. The Fidelity person did not and my first withdrawl form submittal was rejected by the TSP. This added time to the rollover process. Yes, they are really that picky at the TSP. :shock:

I hope you do not have the same problem.

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Re: Heads up: LONG rollover TSP to Vanguard

Post by VictoriaF » Tue Nov 24, 2015 1:58 pm

MichDad wrote:
VictoriaF wrote:This is a good point, especially for those who have a Fidelity office nearby. I don't know if I do, never looked for it, even though I have a Fidelity IRA.
Victoria,

I looked on Fidelity's website and found these branches in the Washington, DC area:

1900 K Street Northwest
Suite 110
Washington DC 20006
Phone: 800-854-2832

1725 Duke Street
Suite GR05
Alexandria VA 22314
Phone: 800-367-1059

...

Good luck with this,

MichDad
Thank you, MichDad!

The first two are very close to me. I just did not think about Fidelity when I was initiating the rollover. The next time I might, depending on how this one goes.

Victoria
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Re: Heads up: LONG rollover TSP to Vanguard

Post by VictoriaF » Tue Nov 24, 2015 2:02 pm

Info_Hound wrote:I too have done a partial rollover from TSP to my Fido account. The problem I encountered was Fidelity needed to keep the written information inside the little square boxes when they filled out their section. The Fidelity person did not and my first withdrawl form submittal was rejected by the TSP. This added time to the rollover process. Yes, they are really that picky at the TSP. :shock:

I hope you do not have the same problem.
I hope Vanguard will do it right, but hope is not a strategy. The best strategy is to allow A LOT of time for dealing with various hitches. Coming to a Fidelity office in person with two copies of the package would also help to prevent your particular issue.

Victoria
WINNER of the 2015 Boglehead Contest. | Every joke has a bit of a joke. ... The rest is the truth. (Marat F)

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Re: Heads up: LONG rollover TSP to Vanguard

Post by Chesterfield » Tue Nov 24, 2015 2:54 pm

For Indirect Rollover (RO)
1) You can request DO NOT withhold any taxes or penalty from the institution and have check sent to you, say on day 1
2) On day 2, log into your account or call up and ask the exact amount of the check that is being sent to you assuming they SOLD shares/liquidated by now. Make sure you get the EXACT amount of the money being sent to you, and not the estimated of the shares being sold.
3) On the same day, note the exact amount. Assume you have enough money for that RO amount in your checking account, which you already linked w/ Vanguard, you can then send that amount to Vanguard. Or, if you don't already have a checking account linked w/ your Vanguard account, then just send a personal check directly to Vanguard RO department.
3) Once you received the check from TSP, just deposit it into your own personal checking account. Verify that's the same amount that you've already given Vanguard (it should be)
I've done this before many many times, but only can do indirect rollover 1x every 12 months. Also, when you fill out tax at the end of the year, there's a couple extra lines to fill out: 1) I did indirect RO for $XXX amount, and 2) I deposited the $XXX amount back within 60 days.

This entire process should take you 1-2 day assuming 1) you have enough money to cover the entire amount of Rollover and 2)personal bank where the sufficient fund is available linked to your Vanguard's account.

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Re: Heads up: LONG rollover TSP to Vanguard

Post by rkhusky » Tue Nov 24, 2015 5:36 pm

The problem with doing the above is that the TSP only allows one partial withdrawal. If you have a significant account, you might want to transfer $500K or more, which many do not have in their checking accounts. However, for those that want to transfer a smaller amount, it appears very feasible.

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Re: Heads up: LONG rollover TSP to Vanguard

Post by VictoriaF » Tue Nov 24, 2015 11:21 pm

Chesterfield wrote:For Indirect Rollover (RO)
1) You can request DO NOT withhold any taxes or penalty from the institution and have check sent to you, say on day 1.
When I called TSP they told me that they would withhold Federal taxes if they sent the distribution directly to me, and there is no way around it.

I wonder if TSP treats partial distributions and scheduled monthly withdrawals differently.

Victoria
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Re: Heads up: LONG rollover TSP to Vanguard

Post by Chesterfield » Wed Nov 25, 2015 1:49 am

VictoriaF wrote:
Chesterfield wrote:For Indirect Rollover (RO)
1) You can request DO NOT withhold any taxes or penalty from the institution and have check sent to you, say on day 1.
When I called TSP they told me that they would withhold Federal taxes if they sent the distribution directly to me, and there is no way around it.

I wonder if TSP treats partial distributions and scheduled monthly withdrawals differently.

Victoria
Did you tell them that you want to do a indirect Rollover entirely? They cannot w/hold your taxes if you rollover directly or indirectly. Now, if they think you're doing distribution, partial or full for other reasons, they will w/hold the taxes should they choose to.

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Re: Heads up: LONG rollover TSP to Vanguard

Post by VictoriaF » Wed Nov 25, 2015 9:14 am

Chesterfield wrote:
VictoriaF wrote:
Chesterfield wrote:For Indirect Rollover (RO)
1) You can request DO NOT withhold any taxes or penalty from the institution and have check sent to you, say on day 1.
When I called TSP they told me that they would withhold Federal taxes if they sent the distribution directly to me, and there is no way around it.

I wonder if TSP treats partial distributions and scheduled monthly withdrawals differently.

Victoria
Did you tell them that you want to do a indirect Rollover entirely? They cannot w/hold your taxes if you rollover directly or indirectly. Now, if they think you're doing distribution, partial or full for other reasons, they will w/hold the taxes should they choose to.
I did not use the words "indirect rollover," but it was clear from the discussion that I was making a rollover, rather than a distribution, and was looking for the most expedient way to do it.

TSP is applying stricter rules to account management than most other employer plans, and withholding taxes on indirect rollovers may be one of its policies.

Victoria
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Re: Heads up: LONG rollover TSP to Vanguard

Post by Info_Hound » Wed Nov 25, 2015 12:46 pm

VictoriaF wrote:
Info_Hound wrote:I too have done a partial rollover from TSP to my Fido account. The problem I encountered was Fidelity needed to keep the written information inside the little square boxes when they filled out their section. The Fidelity person did not and my first withdrawl form submittal was rejected by the TSP. This added time to the rollover process. Yes, they are really that picky at the TSP. :shock:

I hope you do not have the same problem.
I hope Vanguard will do it right, but hope is not a strategy. The best strategy is to allow A LOT of time for dealing with various hitches. Coming to a Fidelity office in person with two copies of the package would also help to prevent your particular issue.

Victoria
I did go to the local Fidelity office and the person who filled out their section had to send it to someone in Ohio who was the only person allowed to 'sign' the form for Fidelity, it appears this person is the authoritive signature needed on the TSP form. They did not follow the written instructions provided by the local person, so we got to do this twice. The second round, with a stronger message provded via phone to the signature authority person, instructions were followed. So the local rep did it perfectly, but only a few of the Fidellity people have the legal authority to sign for Fidelity and they were in an office in Ohio.

Agreed, hope is not a strategy, allowing more than ample time for TSP form processing is. :happy

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Re: Heads up: LONG rollover TSP to Vanguard

Post by VictoriaF » Wed Nov 25, 2015 12:53 pm

Info_Hound wrote:Agreed, hope is not a strategy, allowing more than ample time for TSP form processing is. :happy
Unfortunately, I am more and more relying on hope in this case.

I called Vanguard and a customer service representative (CSR) has confirmed that they have received my package:
- 23 Nov, night, I mailed it via UPS
- 24 Nov, 10:30, I received an email from UPS that the package has been delivered
- 25 Nov, 10:00, Vanguard has received and scanned my package but has not processed it yet.

I asked the CSR to fax the processed package to TSP today, if possible:
- She said that it may or may not be processed today, and I should call again on Friday.
- Faxing forms requires a special authorization within Vanguard.

Victoria
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Re: Heads up: LONG rollover TSP to Vanguard

Post by VictoriaF » Wed Nov 25, 2015 1:13 pm

A side comment:
I have created a Rollover IRA in Vanguard using a link from my account. The resulting account is associated with Vanguard Brokerage and I was wondering if I somewhere took a wrong turn. Today, I asked the CSR why it's a brokerage rather than a regular Vanguard account, and she told me that Vanguard Brokerage is their platform for processing all rollovers. I should be able to invest in Vanguard's mutual funds (as well as ETFs, etc.) from this rollover brokerage account.

Victoria
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Re: Heads up: LONG rollover TSP to Vanguard

Post by VictoriaF » Wed Nov 25, 2015 1:29 pm

Here is how my schedule looks now:
If TSP receives the paperwork on 27 Nov and uses 20 business days to process it, Vanguard will receive the money on 28 Dec, which will leave me 3 days to send Roth conversion forms to Vanguard. This is doable.

If TSP receives the paperwork on 28 Nov or later, or if TSP exceeds their regular processing time, I may miss the 31 Dec deadline for the conversion.

The latter would be an unfortunate event for my financial planning, because right now my Roth conversions are tightly projected forward to be completed by the time I would need to take RMDs.

Victoria

P.S. The stress of a late rollover process had one positive consequence. I have just done my other major 2015 financial moves including a purchase of I Bonds, a contribution to my HSA account, and a contribution to a 529 fund.
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Re: Heads up: LONG rollover TSP to Vanguard

Post by VictoriaF » Tue Dec 01, 2015 8:04 pm

Update: While Vanguard took longer than I thought, TSP was VERY fast:
- 23 Nov - I sent an overnight package to Vanguard.
- 24 Nov - UPS reported that the package has been delivered to Vanguard at 10:15am.
- 24 and 25 Nov - I called Vanguard. They told me that they process all requests in order and can's accelerate any orders due to the compliance requirements.
- (26 Nov - Thanksgiving)
- 27 Nov - Vanguard told me that my Form TSP-77 has been filled out, but faxing it requires a special approval.
- 30 Nov - Vanguard told me that they had faxed the form on 27 Nov.
- 01 Dec - TSP told me that they have approved the form and after COB today it will be forwarded to the Treasury for payment. After the Treasury receives the request, it will take up to 10 business days for Vanguard to receive the money.
- 02 Dec - my TSP account shows that the requested amount has been withdrawn. Interestingly the timelines given are 3-5 days for EFT and up to 10 days for a check. Vanguard may get money as early as the next week!
- 07 Dec - I received an email from Vanguard that they have received my rollover funds.

I am very happy that now I am likely will be able to complete the rollover and Roth conversion before the end of the year. However, I don't recommend that others replicate my experience: it could have been worse, and even for me it's not over until it's over. Still, I want to acknowledge that TSP has far exceeded my expectations.

Victoria

EDIT: 02 December entry added on 02 December.
EDIT: 07 December entry added on 07 December.
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Re: Heads up: LONG rollover TSP to Vanguard

Post by CCRewards » Thu Jul 21, 2016 11:20 pm

VictoriaF wrote:Update: While Vanguard took longer than I thought, TSP was VERY fast:
- 23 Nov - I sent an overnight package to Vanguard.
- 24 Nov - UPS reported that the package has been delivered to Vanguard at 10:15am.
- 24 and 25 Nov - I called Vanguard. They told me that they process all requests in order and can's accelerate any orders due to the compliance requirements.
- (26 Nov - Thanksgiving)
- 27 Nov - Vanguard told me that my Form TSP-77 has been filled out, but faxing it requires a special approval.
- 30 Nov - Vanguard told me that they had faxed the form on 27 Nov.
- 01 Dec - TSP told me that they have approved the form and after COB today it will be forwarded to the Treasury for payment. After the Treasury receives the request, it will take up to 10 business days for Vanguard to receive the money.
- 02 Dec - my TSP account shows that the requested amount has been withdrawn. Interestingly the timelines given are 3-5 days for EFT and up to 10 days for a check. Vanguard may get money as early as the next week!
- 07 Dec - I received an email from Vanguard that they have received my rollover funds.

I am very happy that now I am likely will be able to complete the rollover and Roth conversion before the end of the year. However, I don't recommend that others replicate my experience: it could have been worse, and even for me it's not over until it's over. Still, I want to acknowledge that TSP has far exceeded my expectations.

Victoria

EDIT: 02 December entry added on 02 December.
EDIT: 07 December entry added on 07 December.
Thank you so much for your post and updates! I am helping a parent go from TSP to Vanguard tIRA to Vanguard rIRA this year. I was wondering exactly how much time the process would take, and I'm probably going to try to get the ball rolling sometime late next month or early September. Like you, the numbers are tightly regulated in a projection sheet for us with a rollover and conversion this year helping to decrease future RMDs. We were considering waiting it out a bit to see if TSP offers a Roth conversion option soon, but that seems like a bad reason to wait!

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Re: Heads up: LONG rollover TSP to Vanguard

Post by MichDad » Fri Jul 22, 2016 10:55 am

CCRewards wrote:We were considering waiting it out a bit to see if TSP offers a Roth conversion option soon, but that seems like a bad reason to wait!
CCRewards, I've been following the Federal Retirement Thrift Investment Board's activities pretty closely for the past few years. It seems to me that the Board's action on allowing regular to Roth conversions within the TSP is many months, and probably a few years, away from occurring.

You may find some of the information on this thread of interest:

viewtopic.php?f=10&t=140180

MichDad

CCRewards
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Joined: Tue Feb 23, 2016 10:49 am

Re: Heads up: LONG rollover TSP to Vanguard

Post by CCRewards » Fri Jul 22, 2016 3:37 pm

MichDad wrote:
CCRewards wrote:We were considering waiting it out a bit to see if TSP offers a Roth conversion option soon, but that seems like a bad reason to wait!
CCRewards, I've been following the Federal Retirement Thrift Investment Board's activities pretty closely for the past few years. It seems to me that the Board's action on allowing regular to Roth conversions within the TSP is many months, and probably a few years, away from occurring.

You may find some of the information on this thread of interest:

viewtopic.php?f=10&t=140180

MichDad
Excellent thread! Thank you so much for starting it and for linking it here. I'll read it in full tonight (is it weird that I'm excited to read it???).

MichDad
Posts: 476
Joined: Sat Apr 20, 2013 3:50 pm

Re: Heads up: LONG rollover TSP to Vanguard

Post by MichDad » Fri Jul 22, 2016 4:04 pm

CCRewards wrote:
MichDad wrote:
CCRewards wrote:We were considering waiting it out a bit to see if TSP offers a Roth conversion option soon, but that seems like a bad reason to wait!
CCRewards, I've been following the Federal Retirement Thrift Investment Board's activities pretty closely for the past few years. It seems to me that the Board's action on allowing regular to Roth conversions within the TSP is many months, and probably a few years, away from occurring.

You may find some of the information on this thread of interest:

viewtopic.php?f=10&t=140180

MichDad
Excellent thread! Thank you so much for starting it and for linking it here. I'll read it in full tonight (is it weird that I'm excited to read it???).
Like "Lord of the Flies," it doesn't end well.

MichDad

CCRewards
Posts: 12
Joined: Tue Feb 23, 2016 10:49 am

Re: Heads up: LONG rollover TSP to Vanguard

Post by CCRewards » Sat Jul 23, 2016 9:32 am

MichDad wrote:
Like "Lord of the Flies," it doesn't end well.

MichDad
At least the read was entertaining. Also, I've discovered a new resource: frtib.gov. Thanks again!

CCRewards
Posts: 12
Joined: Tue Feb 23, 2016 10:49 am

Re: Heads up: LONG rollover TSP to Vanguard

Post by CCRewards » Wed Nov 02, 2016 1:08 pm

Hey all! I thought I'd give an update as to our conversion from TSP to rIRA in Vanguard. VictoraF, I'm running about a month and a half ahead of where you were last year. Thanks again for your timeline...it really helped me figure out a timeline for this year.

I had a quick thought that came to me the other day.

Scenario: Someone moves their money from TSP into another broker to engage in a Roth conversion and he/she fills out TSP-70 (Request for Full Withdrawal) and has his/her withdrawal stretched for a number of years. In 6, 7, 8, etc. years, TSP decides that they will allow traditional to Roth conversions within TSP. However, if I understand correctly, TSP-70 cannot be cancelled or undone; at most you can drop monthly draws to $25.00. I guess someone could at that point, fill TSP-78 (Monthly Payments Maintenance) to drop to the minimum $25.00 and keep the TSP longer. However, is there anything preventing someone from then using TSP-60-R (Request for a Roth Transfer Into the TSP) to move money back from a rIRA back into the TSP? I guess my question is, as long as you keep money within an IRA, can't you defeat the TSP-70's intention of eventually closing out your account by using TSP-60 or TSP-60-R to counteract the withdrawal?

CCRewards
Posts: 12
Joined: Tue Feb 23, 2016 10:49 am

Re: Heads up: LONG rollover TSP to Vanguard

Post by CCRewards » Wed Nov 02, 2016 1:11 pm

Also, a question. When someone fills TSP-70 (Request for Full Withdrawal), and opts for monthly draws, how does the timeline for that first withdrawal work? If I want that first withdrawal to be in January, and the forms are received and processed before then, is it possible that my first monthly draw could be in December? Or if I wait a bit, is it possible that that first draw is in February? Is there a way to time it to get your first withdrawal starting exactly from January?

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