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Learning, Sharing, and Teaching => Investor Alley => Topic started by: Fudge102 on January 25, 2017, 12:44:54 PM

Title: Military - Thrift Savings Plan and Civilian Transition
Post by: Fudge102 on January 25, 2017, 12:44:54 PM
Alright, I have a question for the financial guru's out there and I can't find an answer that clears it up for me...

10 years ago, I did NOT invest in the TSP while on active duty.  The way they described it back then and with my more limited knowledge, it sounded like a bad deal.  In the meantime, I've just invested in funds and have a roth IRA as my primary investment means.

Fast forward in time to now.  I'm getting out of the military and have two months to go where I could put some cash into a TSP.  I know that if you have at least $200 invested, you can keep your TSP.  Right now, I took the extra promotion money and have been adding that to my Vanguard account.  I was thinking, I could take that instead and put it into a TSP instead.

My question, is it worth it?  What exact benefits do I get from having about $1400 in an account I won't be able to add anything to in about 2 months?  Thanks and any advice appreciated!
Title: Re: Military - Thrift Savings Plan and Civilian Transition
Post by: Fomerly known as something on January 25, 2017, 01:33:45 PM
I'd say it depends on your plans post military and your tax situation.  You could shelter the $1400 and transfer it into your ROTH from the TSP Roth as a roll over so you would contribute $5,500 + $1400 for this year.  If you think you will ever go into the Federal Government you could just let that $1400 ride there at low fees.
Title: Re: Military - Thrift Savings Plan and Civilian Transition
Post by: Fudge102 on January 26, 2017, 01:05:18 PM
Well right now I just don't want to deal with the government bureaucracy anymore so I'd say the second option is out.  But 1400 rolled over would be a nice chunk into the roth.  Didn't know you could do that.  From what I understood it was it's own thing after you left and would just sit there...
Title: Re: Military - Thrift Savings Plan and Civilian Transition
Post by: fatcow240 on January 26, 2017, 01:24:46 PM
I left my money in TSP after getting out.  You can still transfer your money between TSP funds.  I like the TSP funds and plan on leaving the money there.  I can always roll it over to an IRA.