By Mike Miles
October 2nd, 2012 | Uncategorized
Q. I have been in the service 15 years and plan on being in for at least five to nine more years. I have been putting in 26 percent monthly to the Thrift Savings Plan for the past five years. I have three Roth IRAs, as well. Should I start the Roth TSP, put in $13,000 to $15,000 a year, continue my Roth IRAs and move all my funds from my regular TSP to Roth TSP?
A. I can’t tell you what you should do, since I don’t know enough about your situation to do so responsibly. In general, I recommend that participants max out their traditional TSP contributions before contributing to a Roth IRA.
October 2nd, 2012 at 1:10 pm
It might also be added that he or she is not allowed to move their regular TSP funds over to the Roth TSP.
Al R Says:
October 9th, 2012 at 12:21 am
IF you are confident you will retire in a higher tax bracket and can max out both IRA and Roth TSP every year, then do so. Otherwise for tax diversification, consider maxing ($5,000) out your Roth IRA as well as maxing ($17,000) out your traditional TSP account every year. Not a fan on how the TSP folks decided to implement the Roth TSP option.
BTW you cannot move your traditional TSP to the new Roth TSP.