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Roth TSP start date?
- Thread starter domingo3
- Start date
I guess nobody else really cares about Roth TSP?
I found this that says it now won't be until 2012:
""We anticipate that our work will be done on this at the end of 2011, so we'll be ready to accept Roth contributions beginning in the first pay period of 2012. It is a substantial project and it is a substantial change, because this means that participants can put money in which they pay taxes on up front, but grows tax free. So, it will require operational changes, educational changes and changes to the payroll.""
from http://www.federalnewsradio.com/?nid=19&sid=1894507
I wish they'd update their website instead of leaving old info on there (http://www.tsp.gov/forms/oc06-5.pdf), but then again, I guess nobody but me cares about having the Roth option.
I found this that says it now won't be until 2012:
""We anticipate that our work will be done on this at the end of 2011, so we'll be ready to accept Roth contributions beginning in the first pay period of 2012. It is a substantial project and it is a substantial change, because this means that participants can put money in which they pay taxes on up front, but grows tax free. So, it will require operational changes, educational changes and changes to the payroll.""
from http://www.federalnewsradio.com/?nid=19&sid=1894507
I wish they'd update their website instead of leaving old info on there (http://www.tsp.gov/forms/oc06-5.pdf), but then again, I guess nobody but me cares about having the Roth option.
Frixxxx
Moderator
- Reaction score
- 131
Sorry, I have my own Roth IRA, so I wasn't really into this thread. Looks like you overcame and did the homework.
I'll wait to see if this is a viable investment tool. Maybe you could keep us up to speed domingo3!
I have my own Roth IRA, too, but I can only contribute $5000 per year. I'm certain that my tax rates are going to go up, so I'd be better off with more money in Roth.
I don't mind searching the web to find stuff, but it's frustrating when you don't know if there's new information or not because they keep outdated information on the tsp site.
I'll post back here if I see anything else, but for now, I'm going to assume and make financial plans anticipating that I'll be able to make Roth TSP contributions in 2012.
I don't mind searching the web to find stuff, but it's frustrating when you don't know if there's new information or not because they keep outdated information on the tsp site.
I'll post back here if I see anything else, but for now, I'm going to assume and make financial plans anticipating that I'll be able to make Roth TSP contributions in 2012.
wwwtractor
TSP Strategist
- Reaction score
- 8
In http://www.fidelity.com/ they have 25 ETFs you can buy with no commission. That is where I have my Roth currently.
burrocrat
TSP Talk Royalty
- Reaction score
- 162
is $5000 max per person per year or per roth account?
i have a roth ira at Schwab, no fees, free trades as long as you use their EFT's, there's 8 of them to match or fine tune current TSP offerings, plus the flexibility to invest in anything @ $9 in and $9 out.
i would be interested in TSP roth but it would limit/replace the $5k i can put in the other? i like the diversity and choices of the private account. i'm a little worried what the gubmint might do to limit my investment choices or access to funds in the future. don't want to put all my eggs in one bankrupt basket.
i do 5% to get 5% match then all else available for investing goes into roth ira to grow tax free forever, can't afford to max TSP yet, but it's on my list.
any thoughts?
i have a roth ira at Schwab, no fees, free trades as long as you use their EFT's, there's 8 of them to match or fine tune current TSP offerings, plus the flexibility to invest in anything @ $9 in and $9 out.
i would be interested in TSP roth but it would limit/replace the $5k i can put in the other? i like the diversity and choices of the private account. i'm a little worried what the gubmint might do to limit my investment choices or access to funds in the future. don't want to put all my eggs in one bankrupt basket.
i do 5% to get 5% match then all else available for investing goes into roth ira to grow tax free forever, can't afford to max TSP yet, but it's on my list.
any thoughts?
Roth TSP is NOT the same as Roth IRA. The thing that's the same about both of them is the tax treatment -they will grow tax free forever.
In general (exceptions and caveats apply):
IRAs have limits of $5000 per person per year
TSP has a limit of $16500 per person per year
Right now you can choose to have an IRA as "traditional" which is taxed when you take the money out or "Roth", which is tax free on withdrawl.
Right now, you can only make contributions to TSP as "traditional". Starting in 2012, you can choose to make contributions to TSP as "Roth" if you want to.
Hopefully this explains it. If unclear, the answers to your specific questions:
It doesn't matter how many IRA accounts you have, you are limited to $5000 per year per person.
IRA and TSP are not mutually exclusive. You can contribute to IRA and TSP whether it has Roth tax treatment or not.
Finally a comment: You shouldn't be putting money into TSP that you want to take out before you leave government service. After you leave the service, you can take the money and roll it over to an IRA or if you wish, you can buy lottery tickets with it (minus taxes and early withdrawl fees if applicable).
In general (exceptions and caveats apply):
IRAs have limits of $5000 per person per year
TSP has a limit of $16500 per person per year
Right now you can choose to have an IRA as "traditional" which is taxed when you take the money out or "Roth", which is tax free on withdrawl.
Right now, you can only make contributions to TSP as "traditional". Starting in 2012, you can choose to make contributions to TSP as "Roth" if you want to.
Hopefully this explains it. If unclear, the answers to your specific questions:
It doesn't matter how many IRA accounts you have, you are limited to $5000 per year per person.
IRA and TSP are not mutually exclusive. You can contribute to IRA and TSP whether it has Roth tax treatment or not.
Finally a comment: You shouldn't be putting money into TSP that you want to take out before you leave government service. After you leave the service, you can take the money and roll it over to an IRA or if you wish, you can buy lottery tickets with it (minus taxes and early withdrawl fees if applicable).
Frixxxx
Moderator
- Reaction score
- 131
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