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This is from the Fool's own retirement planing section:

Generally, normally, usually (truly! madly! deeply!), the best choice for a retirement plan distribution is to transfer that money to an Individual Retirement Account. By doing so, the tax-deferred status of that sum continues and we reduce our current tax burden.

I am a ways from retirement being 44 and work for the U.S. Postal Service(20 years now plus 4 years Military), we have what is called the Thrift Savings Plan, it is a type of 401k savings plan. When we retire we have three choices to withdraw the funds, one is a lump sum (ouch! tax bite!) two is a fixed dollar amount payed over a fixed number of months or three convert it into an annuity based on an IRA life expectancy table. I would be able to retire at age 55 and then be able to take withdrawl from the account without penalty. So why would I want to transfer it to an IRA? If I just leave it in the TSP it would still be tax defered untill I take it out with the added benifit of being able to take it out at age 55 instead of 591/2. It is invested in a S&P 500 index and a Russel 2000 index fund, and if I transfered it to an IRA it would most likely be invested the same so why move to an IRA after I retire?
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