Also, are you paying this "advisor" any money beyond the sales commissions from the funds? If so, what services is this person providing?
And, yes, you should continue to fund the Roths, for the reasons stated by others. The TSP funds are an excellent way to save for the second half of your retirement. In your shoes, I would take full advantage of the TSP.
I'm not paying him directly, no. But I'm sure he's taking almost every bit of that front-end load from American Funds.
And before I take on the next subject let me open with a VERY POSITIVE COMMENT. I really do appreciate the input, and advice. It's fucking GREAT! I learn a lot by doing research just like this. And that in turn helps me teach my wife some things I bet she thought she'd never know. AWESOME! We are truly grateful.
Everyone seems to have the same theme regarding the Roth IRAs; keep "investing". Which I read as "keep maxing out". Further defined as "Keep taking $11,000 annually out of your 'fuck you money account' ". The whole point of this blog is to sacrifice your butt off early and hard, so that you can do with your life whatever you please, because along your journey you will learn to need less while consuming less. Which really is a double-whammy! I really just might not be wrapping my head around this right, so please, if I am wrong, tell me again.
The way I see it is this:
I receive a pension in 12 years time, what a perfect goal (which I believe to be key to this equation) to shoot for ER/FI. It will be approx $2K/mo income (low-end). We have (assuming absolutely no raise ever again, forever) roughly $23,700 that is available each year to pursue FI.
$24K rounded * 12 years = $288,000 available for 4%/yr withdraw rate if needed right
then! Remember we have $2K/mo to supplement that number. 4%(1K/mo.) + $2K = $3K per month. RETIRED. FOREVER. STARTING RIGHT THEN. Not to mention all the time in the world to pursue whatever we want, I'm sure earning some sort of an income as well.
If we go the "keep maxing out the Roth IRAs"-route:
$24K rounded - $11K for Roth IRAs = $13K/year. $13K * 12 years = $156,000 immediately available to draw 4% on. 4%($500/mo.) + $2K = $2.5K per month.
BUT we will have roughly $150K in Roth IRAs that will sit for another 20 years if needed at age 60
and we can draw up to $150K out (principal invested) as needed to supplement the $2.5K per month income. We could probably get by on this one, no problem, but I'd have to watch/learn a little more hardcore.
Actually after spelling out both scenarios. I don't know which one sounds better. I though I'd go with "option A" without a question. But "option B" doesn't sound too awful bad.
How does inflation fit into these numbers?