Social Security and TSP Withdrawals in Retirement | Financial Advisor | Christy Capital Management

Social security becomes taxable when your combined income exceeds certain thresholds.

Your Provisional Income (the amount of income that is taxable) is the sum of your AGI (Adjusted Gross Income - includes federal annuity and traditional TSP withdrawals) plus tax exempt income (from municipal bonds) plus 50% of your Social Security income.

Most federal employees have the vast majority of their money in the traditional TSP and haven’t paid taxes on that money yet. When you make withdrawals, the distributions are taxable. This adds to your income for social security planning purposes.

Roth TSP and Roth IRA distributions can be tax free. But, you cannot take existing TSP and convert it into Roth TSP. Roth TSP will require RMDs (required minimum distributions).

Withdraw from your TSP in an amount that covers your income gap, but will last the rest of your days with reasonable expectation. Make sure you take into consideration the 2 main enemies of retirement, inflation and taxes.

NOTE: Retirement Benefits Institute is now Christy Capital Management: See our latest federal-focused articles and resources at https://christycapital.com/federal

#FERSretirement #FederalRetirement Christy Capital Management has helped thousands of federal employees as they make plans for federal retirement. For more information about your federal retirement benefits, go to our website at https://christycapital.com/federal to get support.

The information contained in this video should not be used in any actual transaction without the advice and guidance of a tax or financial professional who is familiar with all the relevant facts. The information contained here is general in nature and is not intended as legal, tax or investment advice. Furthermore, the information contained herein may not be applicable to or suitable for the individuals’ specific circumstances or needs and may require consideration of other matters. RBI is not a broker-dealer, investment advisory firm, insurance company, or agency and does not provide investment or insurance-related advice or recommendations. Brandon Christy, President of RBI, is also president of Christy Capital Management, Inc. (CCM), a registered investment advisor.