TSP Loans Explained: Borrowing From Yourself the Smart Way

In this episode of Rayna Retirement, Rayna Reyes breaks down one of the most misunderstood features of the Thrift Savings Plan: TSP loans. Rayna explains how federal and postal employees can borrow from their own TSP accounts using general purpose loans, residential loans, and hardship withdrawals — while also outlining the potential risks, repayment rules, and tax implications involved. She discusses why TSP loan interest rates are often lower than traditional bank loans, what “opportunity cost” means when borrowing from retirement savings, and what happens if you retire before fully repaying your loan. The episode also covers important considerations involving tax brackets, Medicare IRMAA thresholds, and strategies some retirees use when deciding whether to continue repayment or allow a loan balance to become taxable income. Throughout the conversation, Rayna emphasizes that every situation is different and that careful planning matters when using retirement assets as a borrowing tool. To schedule a consultation or request an on-site workshop, contact Rayna and the team at American Federal Benefits Consultants. -- Contact Rayna directly at 850-450-6500 Or call the American Federal Benefits Consultants team at 1-800-872-8857 Visit: AmericanFederal.org -- YouTube: https://www.youtube.com/@RaynaRetirement Rayna Retirement is the go-to podcast for federal employees – or anyone – looking to make smarter financial decisions with clarity and confidence. Hosted by Rayna Reyes, co-founder of American Federal Benefits Consultants, this show simplifies the complexities of retirement, benefits, and financial planning. Whether you're navigating your FERS or CSRS pension, maximizing your TSP, or seeking expert advice on 401(k)s or IRAs, Rayna is here to guide you every step of the way. Tune in for practical knowledge, ethical solutions, and expert insights as you prepare for a secure and fulfilling retirement.