Your Annuity Interest Rate
The annuity provider will use the interest rate index in effect for the month in which the annuity is purchased, which may not be the rate that was in effect when you sent in your request or when the TSP processed your request.
Annuitize Part of Your TSP Account
To purchase an annuity, you don't need to use the full amount of your TSP vested account balance. If you only want to annuitize part of your TSP account to ensure a guaranteed stream of payments, you can do so as long as your annuity purchase is at least $3,500.

Step One

 

Before completing the necessary form to purchase your annuity, you should read the Annuities section of the TSP booklet Your TSP Account: A Guide for Beneficiary Participants.

Remember, the annuity that you purchase through the TSP is not the same as a TSP monthly payment, which is one of the other full withdrawal options.

Step Two

 

If you have determined that an annuity is appropriate for your needs, you should complete Form TSP-90, Withdrawal Request for Beneficiary Participants. Be sure to read the form and instructions carefully as they outline specific requirements that must be met in order to avoid any unnecessary delays in processing.

Keep in mind that there is a $3,500 minimum amount required to purchase an annuity. If you are using only a portion of your account for an annuity, the percentage of your account that you choose when requesting it must equal $3,500 or more of your vested account balance.

If you have both a traditional and a Roth balance in your account, the $3,500 minimum threshold applies to each balance separately. Also, you cannot choose different annuities for each type of balance. The TSP will purchase two identical annuities — one with each balance.

Step Three

 

After the TSP receives all of the information and documentation necessary to purchase your annuity, it may take up to several weeks to process your request and disburse your funds.

Your annuity will be purchased from the TSP annuity provider. The annuity provider is competitively chosen by the Federal Retirement Thrift Investment Board, the agency that administers the TSP.

Once the funds for your annuity have been disbursed, you cannot cancel your annuity, change your annuity option, or change your joint annuitant.

Step Four

 

Once the money has left your account, you should direct all communications concerning your annuity to the annuity provider. The provider will send you a package of information and an annuity contract. Your monthly annuity payments will begin approximately one month after the annuity is purchased.