<prompt> Human: Its been about six months since Ive left my old job for a better one and Ive been contemplating what to do with my old retirement plan TSP. Granted theres only about 5k in it, Ive been thinking about cashing it out and paying off student loans or other bills with it or moving it to my new companys 401k. Ive read the How to handle for 25-35 and it says to never cash out and to just move it. I have about 4k in debt so in theory I could just move 1K over and take the rest and pay off my debt, but would that be the best option in the long run?  <response>: Not only should you never cash it out, you should never roll your TSP over to an IRA.First off, realize that if you take 4,000 out, you will not be getting 4,000. There is a mandatory 20 withheld for taxes, which will reduce the amount down to 3,200. Additionally, the 20 does not represent the actual amount of taxes and penalties you actually would owe; if your marginal tax rate at the end of the year is above 10, youll owe more money in taxes on your withdrawal. Plus, if your state levies income taxes, youll owe some more for state income taxes, too. All in all, you could be looking at losing 25-40 of the money you withdraw.Second, The Federal Thrift Savings Plan has much lower-cost investments compared to what you can get as a retail investor. Right now, the expenses on the TSPs funds is 0.029. While US stock index funds have gotten close, I have yet to see any Target-Date funds or international index funds get close to the low expenses of the TSP. What you really should consider is, instead of rolling money out of the TSP, you should roll any future retirement savings from other employers into the TSP. 