Not until 2014 will military get access to Roth TSP!

[domingo3]

I thought this might deserve a new topic.

I assume this will be the same deal for the other services as well. Those in the the Army will begin to be able to contribute to Roth TSP in April .... 2014!!!!! I find this truly unbelievable. Here is the message I got:

"ROTH TSP will not be available to Army service members until April 2014. At present the Federal Retirement Thrift Investment Board, OSD, DFAS and the Services are still coordinating the action. "

I wrote back to ask if it was a typo. The sender confirmed 2014, and said something about hoping to get it done sooner.


Personally, I had scaled back my TSP contributions to only 1% so that when Roth came online, I could put almost all of my money into that. I guess I have to rethink my plan.

 

[Birchtree]

What the military really needs is access to a defined contribution plan for members - many only do several years and then walk away instead of staying for 20. When they walk away at least they could have a mobile retirement plan they could take to a new employer. TSP could easily be their vehicle.

 

[domingo3]

I agree. I also believe the defined benefit plan is unsustainable in its current form. There have been some proposals for changes to the retirement system. I think the trouble with the idea getting traction is that they haven't had a proposal that will have short-term relief to the budget, but also make the transition from old to new fair.

 

[wvango]

Hey domingo, where did you see 2014 for the Army?

 

[domingo3]

Hey domingo, where did you see 2014 for the Army?

The part in quotes in the original post is from an Email I received from DFAS after I inquired if the systems would be ready for the April 2012 start. I haven't seen this published anywhere. I'd like to raise awareness of it, but unfortunately, most of my fellow Soldiers are not much interested in financial planning, so they really don't care or understand.

 

[driz]

What the military really needs is access to a defined contribution plan for members - many only do several years and then walk away instead of staying for 20. When they walk away at least they could have a mobile retirement plan they could take to a new employer. TSP could easily be their vehicle.

Yes that's all true but right now there is a 600 lb gorilla in the room. There are times to push for change and this for sure isn't one of them. Some of us were around to watch the Congresstards mess around with civilian retirements back in the mid 80's and the result was FERS. Not too terrible but still a rip off compared to CSRS no matter how you look at it. Now you take a look at what's going on today and the players involved and I don't see anything good happening to anyone in our situations. Now's the time to sink in those fingernails to the little we have and try to hold onto what we can of it. If we end up with many more Tea Party congresstards in there you military guys will be fighting the next one getting paid with green stamps.

 

[domingo3]

Roth TSP rollout delayed for DoD, other agencies - FederalNewsRadio.com

I've seen this game before - say you can't get it done until 2014, now say you only have to wait until October, so you're a hero. I wonder what the next move will be.

 

[wvango]

Roth TSP will be ready 1 June for Marine Corps Active and Reserves. The will have to go to the Admin Office to request to contribute and set allocations. This is all due to MyPay not being ready for the transition. Word is MyPay should be ready sometime in July. Civilian employees will be ready sometime late June is what I am hearing. As far as the other services, I hear they are not ready for the transition yet, but I can not say for sure.

 

[JTH]

What kind of ROTH will this be, will I have the same 5 choices I have now with 2 IFTs? Could I buy an individual stock?

 

[wvango]

Same choices as regular TSP and no individual stocks.

What kind of ROTH will this be, will I have the same 5 choices I have now with 2 IFTs? Could I buy an individual stock?

 

[driz]

I wouldn't sweat the delay really. Remember there is nothing wrong with the good old fashioned IRA. The Roth may be the better for you but in it's absence it's best to just keep plowing along with the traditional IRA version. Don't let it get you down just keep keepin on and you will be fine. Remember in all respects you new guys have it all over guys like me. I had those incremental limits from day one while you guys can just max out the IRS limit right from day one. Personally I came out smelling like a rose in spite of it all and you can do a lot better. TSP has been behind schedule with everything it has done since day one so another delay is just business as usual. With that in mind jut keep stashing away what you can where you can. The Roth will get fully implemented in good time but in the mean time do what you can with what you have and you'll be fine.

 

[James48843]

I was very glad to read the Department of Interior says they'll be ready at the open. I work for FAA, and Interior runs our payroll. So we should be on the leading edge. Here is crossing my fingers. I'm sitting down now and thinking about how much of my TSP I want to run as a Roth, and how much to run as traditional TSP. Not sure what is going to happen to taxes in the future, so I still want to run some of both to cover both bases.