No. of Recommendations: 0
Dear Crowinghen: There are many good reasons to use TSA retirement accounts - In a workplace that offers them (public school system or non-profit) you make pre-tax payroll deductions (like 401k plans), so you reduce your taxable income for that year; the funds grow tax-deferred (like 401k & IRA) until you draw funds out (after age 59 1/2 to avoid penalty from IRS); meanwhile in a variable annuity plan you are able to allocate among investment accounts that may include mutual fund-like investments in stock, bond, international stocks, indexes, or even a fixed interest fund which has guarantees! Some TSA's offer free, unlimited transfers among the accounts. As an "insurance" product a TSA usually offers some kind of guaranteed payoff to a beneficiary in the event of the premature death of the account owner - like a guarantee to pay out at least the amount that was contributed, regardless of the account value at the time of death (a handy feature when invested in aggressive stocks during periods of market volativity).
In addition to the option to convert this annuity into a guaranteed "income stream" during retirement, you may also opt to make only occasional partial withdrawals. There could be other benefits, too. Why don't you get a complete explanation from the TSA provider? Good luck. PP
Print the post  


The Retirement Investing Board
This is the board for all discussions related to Investing for and during retirement. To keep the board relevant and Foolish to everyone, please avoid making any posts pertaining to political partisanship. Fool on and Retire on!
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.