TSP vs. IRA

starshard0 · 10-28-2008, 11:35 AM

I'm currently serving in the military, and as a government employee I'm authorized to contribute up to %100 of my income to a TSP. None of it is matched however. I'm not entirely sure how I should spread my investments between my TSP, IRA, and non-retirement related investments. Can anyone lend me some advice?

khorrell · 10-28-2008, 05:34 PM

Dear Starshard,

You might be sorry that you asked! I write a personal finance blog for military families and I did a post on exactly that subject: TSP or IRA? Retirement Choices for Military Members. The short (and not helpful) answer is that it depends. I went over all kinds of questions to ask yourself in the article. While it is true that you can contribute up to 100%, you max out at $15,500 per year. (That is a lot easier to reach if you have been in for a while, but if I remember correctly you are pretty young, so that is probably a good chunk of your income.) You can also put $5000 per year into an IRA. Which choice is better for you depends on your particular situation.

Congratulations on planning ahead for retirement. Both TSP and IRA offer great benefits and whichever you choose (or both), you are making a great decision.

Check out the blog: The Paycheck Chronicles.

starshard0 · 10-29-2008, 06:17 AM

Oh that's awesome, thanks! I had no idea where my TSP capped out so I wasn't sure if I even COULD max it out. That makes it a lot easier to decide.

khorrell · 10-29-2008, 10:00 AM

I didn't mention yesterday that I would absolutely love to have your feedback on my site. You are exactly my target audience! Any thoughts, suggestions or criticisms are most welcome.

AnninOhio · 11-01-2008, 10:40 AM

They don't match at all? I was in the TSP several years ago and they matched up to 5% of your salary (depending on your contribution). I was surprised that there's no match for you....

khorrell · 11-01-2008, 01:04 PM

We wish! Unfortunately, military members do not get any match like their civilian government counterparts do.

I'm glad you were able to get the match though!

10-28-2008, 11:35 AM	#1
starshard0 Senior Member Join Date: Apr 2008 Location: Monterey, CA Posts: 608 Thanks: 0 Thanked 2 Times in 2 Posts Reputation: (13)	TSP vs. IRA I'm currently serving in the military, and as a government employee I'm authorized to contribute up to %100 of my income to a TSP. None of it is matched however. I'm not entirely sure how I should spread my investments between my TSP, IRA, and non-retirement related investments. Can anyone lend me some advice?

10-28-2008, 05:34 PM	#2
khorrell Senior Member Join Date: Jan 2008 Location: near Washington DC Posts: 608 Thanks: 0 Thanked 2 Times in 2 Posts Reputation: (85)	Dear Starshard, You might be sorry that you asked! I write a personal finance blog for military families and I did a post on exactly that subject: TSP or IRA? Retirement Choices for Military Members. The short (and not helpful) answer is that it depends. I went over all kinds of questions to ask yourself in the article. While it is true that you can contribute up to 100%, you max out at $15,500 per year. (That is a lot easier to reach if you have been in for a while, but if I remember correctly you are pretty young, so that is probably a good chunk of your income.) You can also put $5000 per year into an IRA. Which choice is better for you depends on your particular situation. Congratulations on planning ahead for retirement. Both TSP and IRA offer great benefits and whichever you choose (or both), you are making a great decision. Check out the blog: The Paycheck Chronicles. __________________ The Paycheck Chronicles "helping military families make the most of their paychecks"

10-29-2008, 10:00 AM	#4
khorrell Senior Member Join Date: Jan 2008 Location: near Washington DC Posts: 608 Thanks: 0 Thanked 2 Times in 2 Posts Reputation: (85)	I didn't mention yesterday that I would absolutely love to have your feedback on my site. You are exactly my target audience! Any thoughts, suggestions or criticisms are most welcome. __________________ The Paycheck Chronicles "helping military families make the most of their paychecks"

11-01-2008, 01:04 PM	#6
khorrell Senior Member Join Date: Jan 2008 Location: near Washington DC Posts: 608 Thanks: 0 Thanked 2 Times in 2 Posts Reputation: (85)	We wish! Unfortunately, military members do not get any match like their civilian government counterparts do. I'm glad you were able to get the match though! __________________ The Paycheck Chronicles "helping military families make the most of their paychecks"

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10-29-2008, 06:17 AM	#3
starshard0 Senior Member Join Date: Apr 2008 Location: Monterey, CA Posts: 608 Thanks: 0 Thanked 2 Times in 2 Posts Reputation: (13)	Oh that's awesome, thanks! I had no idea where my TSP capped out so I wasn't sure if I even COULD max it out. That makes it a lot easier to decide.

11-01-2008, 10:40 AM	#5
AnninOhio Junior Member Join Date: Oct 2008 Posts: 4 Thanks: 0 Thanked 0 Times in 0 Posts Reputation: (10)	They don't match at all? I was in the TSP several years ago and they matched up to 5% of your salary (depending on your contribution). I was surprised that there's no match for you....