Sorry, Louie, I saw your PM first or I would've answered on this thread.
If you haven't already seen my PM response, here's the content:
First, as long as you're earning a military salary, I think that you can afford to invest more aggressively. (When my spouse and I were in uniform, we invested in 100% equity funds in our retirement & taxable accounts. Today, in retirement, we're 90% in equity funds and 10% in cash-- two years of expenses.) If you're happy with your current asset allocations in Vanguard and your TSP, then stick with them. The more important factors are being able to sleep soundly at night (not worrying about volatility) and not needing to spend a lot of time tweaking everything (decision fatigue, paralysis by analysis).
http://the-military-guide.com/2010/12/30/tailor-your-investments-to-your-military-pay-and-your-pension/Next, the advantage of your TSP is primarily expenses. I don't know the expense ratios on your Vanguard funds, but I bet they're at least twice as high as the TSP equivalents.
https://www.tsp.gov/investmentfunds/fundsoverview/comparisonMatrix.shtmlFinally, there's taxes. At your current income (especially with tax-free allowances), you're in a fairly low tax bracket. You can lower your tax bill even more by contributing to the conventional TSP, or you might still be down in the 10% income tax bracket despite contributing to the Roth TSP. I know that Vanguard has a reputation for tax efficiency, but every year you're paying taxes on dividends & capital gains. When you invest in the TSP, there are no taxes until you withdraw the funds. If you contribute to the Roth TSP (after paying income tax on the salary that you contribute) then there are no taxes ever.
One other feature: someday the "G" fund might be a good replacement for a bond fund as part of an asset allocation, and it's only available in the TSP.
Now let's look at getting that money out before age 59.5:
http://the-military-guide.com/2014/03/20/early-withdrawals-from-your-tsp-and-ira-after-the-military/ You already know about the Roth IRA conversion ladder, and you know that you can withdraw your Roth IRA contributions anytime for anything. Now all you need to do is cover five years of expenses while you wait for five tax years to pass in your Roth IRA conversion ladder.
A few years before you hang up your uniform, save up 5-6 years of annual expenses in a taxable account. During your first year out of the service, you can roll over your Roth TSP to a Roth IRA and that entire amount can be withdrawn after five tax years. You've already paid taxes on the contributions, and after meeting the five-tax-year limit on the amount of the conversion (that you rolled over to the Roth IRA) then you can withdraw that too. Notice that unlike your Vanguard taxable accounts, you paid zero additional taxes and you enjoyed decades of lower expense ratios.
It's a little more complicated with the conventional TSP, but after you leave the service you can still roll it over to a conventional IRA. When you stop working (and your taxable income goes to nearly zero) then every year you can convert a small amount of that conventional IRA to a Roth IRA. You'll have to pay tax on the gains, but you'll be in a very low tax bracket (with exemptions and deductions) and you might end up owing zero in taxes. In any case, you'll pay far less in conversion taxes than you would have paid in those taxable Vanguard accounts. And five tax years after you've converted the conventional IRA to a Roth IRA, the entire amount of the conversion is able to be withdrawn free of penalties & taxes.
