IRA or TSP

[m.wheelz]

Which one is better an IRA or TSP?

 

[James48843]

Which one is better an IRA or TSP?

If you are a FERS civilian employee, TSP.

Because you get matching funds.

 

[m.wheelz]

Im in the military been in 12 1/2 years. Will it be best to keep the TSP till im 59 1/2 or roll it into an IRA which i also have. Or should i just keep both?

 

[Spaf]

IMHO
TSP = simple paper work, good index funds, easy to transfer funds, very low expenses, and a lot of options on retirement.
TSP is tax deferred status.
I don't know of a better retirement savings vehicle??.....
Tax paid funds should be with a Roth or internet broker, money market, etc.

Im in the military been in 12 1/2 years. Will it be best to keep the TSP till im 59 1/2 or roll it into an IRA which i also have. Or should i just keep both?

 

[James48843]

I would agree with Spaf on that one.

I have a second TSP account- that has funds from when I was a drilling reservist. The benefit of keeping it in TSP at that point is the ability to move it around a no cost (so far, anyway), and extremely low fees.

You really can't find a less costly IRA as an alternative.

If you have an IRA that allows you to actively manage it in places the TSP won't go, then by all means you should evaluate those possibilities as well. (I'm thinking gold, oil, REITS, certain foreign EFT's, etc) if it's part of a balanced portfolio, then it may be worth investigating. On the other hand, if all it is is a set of index funds like TSP is, then TSP wins hands down on costs.

Up to you. Its YOUR money.

 

[m.wheelz]

James you say you have 2 TSP's how could I go about getting a second one?

 

[James48843]

I have my federal civilian job TSP account.

And then, when I was a drilling reservist, I had a second account establish to deposit military TSP funds into.

Now that I am retired from the Guard, I play with them both, different strategies.

My civilian account is substantial. My military only had aobut two years of drill pay into it when I retired. So it is much smaller.

How can you get a second account?

If you are a federal employee, join the Guard.

If you are a military member, then get a federal job.

That's the way I did it.

 

[Viva_La_Migra]

With the TSP putting up limits on IF transfers, would it make sense to reduce contributions to TSP (I currently contribute 10%) and start a Roth IRA? If so, which investment firm would you use? I've looked at TD Ameritrade, Scottrade, and Charles Schwab, but I'm not sure which one to go with.

BTW, I am planning on opening a Roth IRA anyway, I just want to know if I should use my TSP funds and whatever we get in January for COLA, or just use the COLA and overtime, when I get it?

 

[CountryBoy]

With the TSP putting up limits on IF transfers, would it make sense to reduce contributions to TSP (I currently contribute 10%) and start a Roth IRA? If so, which investment firm would you use? I've looked at TD Ameritrade, Scottrade, and Charles Schwab, but I'm not sure which one to go with.

BTW, I am planning on opening a Roth IRA anyway, I just want to know if I should use my TSP funds and whatever we get in January for COLA, or just use the COLA and overtime, when I get it?

Just FYI, I contribute to my TSP to get all the matching funds, then I Max out 2 ROTH IRA's, me and my wife, and then any extra I try to put back inot the TSP. So far no extra with a daughter in college. :laugh:

I use Sharebuilder for my ROTH's, I can purchase individual stocks and most ETF's ie Vanguards, but no mutuals. I find for my purpose, it is much cheaper with minimal management fee's, but you got to do the studying on what to purchase. I have 2 mutuals with AG Edwards and have found that I know as much, if not more, than my so called "broker", it just takes some bookwork and brokers always have a product to push. I actually had to argue with my broker when I wanted a mutual that Edwards wasn't pushing. Thats's when I decided that Sharebuilder met the requirements I was looking for.

CB

Just my $0.02

 

[Bullitt]

I've been kicking this one around for a while now. I'm considering a Roth IRA in a no load mutual fund that pays dividends. Don't forget about commissions if you decide to go with a Scottrade or TD Ameritrade. I think Sharebuilder reinvests dividends in individual stocks but I'm not sure. Remember that no matter how low the fees are, commissions will eat away at your capital. Don't fall for 'the great mutual fund trap' by plopping your money into today's hottest fund either.

Still on the fence but even if I decide to contribute to a Roth, I'm going to continue to max out my TSP for the next 30 years. IMO the TSP is the best retirement plan going. Simple and boring is best when it comes to long term money management.

 

[ChemEng]

Still on the fence but even if I decide to contribute to a Roth, I'm going to continue to max out my TSP for the next 30 years. IMO the TSP is the best retirement plan going. Simple and boring is best when it comes to long term money management.

Im taking a different approach to the same problem. (For references, Ive got a similar retirement window at around 30 years or so.)

I went first with 5% contributions to TSP to receive max matching monies. Then I started a Roth up to the max ($4k in 2007, $5k in 2008). Now Im working TSP back up with each yearly COLA adjustment.

Im not saying this is the right way to do things, just a different way to tackle the same issue.

 

[CountryBoy]

I think Sharebuilder reinvests dividends in individual stocks but I'm not sure.

Yeah Sharebuilder will reinvests automatically if ya want into the individual stock.

CB