Squalebear's Account Talk

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Leaving the TSP once you've accumulated a substantial balance is not efficacious IMHO because of the tax consequences. You can now go directly into a Roth IRA on a disciplined distribution paying the tax as you proceed. Leaving as much money in TSP to continue working is the best approach because it is so cost effective. You simply have to learn how to churn when the time is ready - and that is anxiety provoking when you are retired. But making extra money is never easy and requires a certain degree of expertise. That's why the market is a great equalizer for some because it is wide open.
 
Of coarse the matching does not apply to Military Personel and only
matches a maximum of 5% of the Federal Civilian employee's Base Salary.

Those who contimplate moving their TSP into an IRA (Reg or Roth) will
also have their monies locked into the accounts until age 59 and a half.
So the decision becomes just a little more complicated then just the tax
implications.

I tried to read up on 72T's but never found the time to become too familiar
with them. I believe 72T.ORG still exists and some may find it interesting.
 
You can take money tax free out of a Roth IRA after five years. The best idea from a Roth IRA is for the heir. The Roth IRA does not have a required minimum distribution at any age.
 
Birchtree said:
You can take money tax free out of a Roth IRA after five years. The best idea from a Roth IRA is for the heir. The Roth IRA does not have a required minimum distribution at any age.
Click to expand...

It's a great idea for passing on inheritance. It's also a great idea if you come from a long-lived family, never mind inheritance. e.g. 3 of my 4 grandparents lived well into their 90's as did at least 1 great-grandparent. One of the 90+ grandparents is 103 this year and still in her own home with family support and more recently with a daily paid helper.
 
But taking your TSP and moving it to a Roth will mean taking an immediate
TAX hit (but with no penalty). I'd love to transfer my entire TSP to a Roth
IRA but never truly considered it because of the immediate Tax Bill that is
required to be paid by years end (maybe a month or two later).

What I Would Love To Do:

*Move my money to a vehicle that allows me to Trade Stocks and Bonds.
*The vehicle would allow Monthly Withdraws but taxed as regular income.
*The Monthly Withdraw needs to be adjustable, even if its once a year.
*The vehicle will not cost me a Early Withdraw penalty.
 
So me being in the Air Force, they do not match the 5% that I put into it? When do they match it? I thought that they match the first 3% dollar for dollar and the next 2% it is 50 cents on the dollar. Please explain.
 
zacattacker said:
So me being in the Air Force, they do not match the 5% that I put into it? When do they match it? I thought that they match the first 3% dollar for dollar and the next 2% it is 50 cents on the dollar. Please explain.
Click to expand...
No, Military gets no matching.....If you retire from military service, your retirement is basically an annuity at a value of more than $1,000,000. You are paid 1/2 your base pay every month after you leave.

Hence, no matching. This should be enough to make anyone want to retire from military service. If you retire at 38, your retirement check would be half of let's say E-7 or ~$2,000. Mulitply that by 12 $24,000 for the first year. add avg of 3% COLA a year, by the time you are 73, that annuity is paying you $60K a year. If you put 15% a year in your TSP/401K/Roth IRA, you could rack up some serious green by then.

One Source should have people to help you see this: www.airforceonesource.com
 
Although you don't currently receive matching funds I can only wish the TSP was available when I was in the service. After 20 years I would have had a great headstart on my next retirement investment. Most of us had to start from scratch or invest outside the military. Keep putting it in there, you won't regret it.
 
Yeah, I totally think that I am on the right track, and wish that I started even earlier. Because time is key to building wealth. I love investing and watching my money grow so i will be in it till the end. :)
 
zacattacker said:
Yeah, I totally think that I am on the right track, and wish that I started even earlier. Because time is key to building wealth. I love investing and watching my money grow so i will be in it till the end. :)
Click to expand...

A Wise Choice ! ;) Sorry you don't get matching contributions. From the
look at the posts below, your gonna do just great ! :)
 
Frixxxx said:
No, Military gets no matching.....If you retire from military service, your retirement is basically an annuity at a value of more than $1,000,000. You are paid 1/2 your base pay every month after you leave.

Hence, no matching. This should be enough to make anyone want to retire from military service. If you retire at 38, your retirement check would be half of let's say E-7 or ~$2,000. Mulitply that by 12 $24,000 for the first year. add avg of 3% COLA a year, by the time you are 73, that annuity is paying you $60K a year. If you put 15% a year in your TSP/401K/Roth IRA, you could rack up some serious green by then.

One Source should have people to help you see this: www.airforceonesource.com
Click to expand...

Thank You Frixxxx for stating "no matching funds for you GI". Stating otherwise has happened on this board and is a real red flag issue to me. Your reasoning for uniformed service members not getting matching funds is IMO 100% bull. They have been eligible under TSP rules but not given the benifit. See: http://www.tsp.gov/uniserv/features/chapter04.html

I have abused SB's home too much all ready. Gonna post more in my own underused thread.

Frixxxx, good call on onesource.
 
Who is entitled to receive matching contributions?

Under the law that extended the TSP to the uniformed services, the secretary responsible for each service may designate critical specialties for matching contributions. Members serving in those specialties who agree to serve on active duty for 6 years may be eligible for matching contributions during the 6-year active duty obligation.

The matching contributions apply only to amounts contributed from basic pay and not from any incentive pay or special pay. If you do not contribute basic pay to the TSP, you will not be eligible to receive matching contributions. Matching contributions apply to the first 5 percent of pay that you contribute each pay period. Your contributions are matched dollar-for-dollar on the first 3 percent of pay you contribute each pay period and 50 cents on the dollar for the next 2 percent of pay.

As of the date of this Web edition, matching contributions had not been authorized by any of the uniformed services.
Your service will notify you if you are eligible to receive matching contributions.

THIS CAME DIRECTLY FROM THE TSP WEBSITE
http://www.tsp.gov/uniserv/features/chapter04.html
 
Howdy SB. How is my Jedi Master doing? Have a great weekend. Grabbing some lunch before I get ready for my second job. See ya!!!
 
Then I will call it a night and not go any further -- I PROMISE

Because there is no way I could find any 'news' to top that.


Things should continue getting better and better - please if it's not asking too much....

give Kelly a little hug for me ;)

Later my friend

Steady
 
Steadygain said:
Then I will call it a night and not go any further -- I PROMISE

Because there is no way I could find any 'news' to top that.

Things should continue getting better and better - please if it's not asking too much.... give Kelly a little hug for me

Later my friend

Steady
Click to expand...

Gosh, since we met, my wifes hug allowance has doubled. :nuts:
She's even put a few on layaway for future use. ;)

Guess who benefits the most from that ! :cheesy: HeHeHe ! :laugh:
 
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