Invest in both Roth TSP and Roth IRA?

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Q. I am a FERS employee who has 12 years before I can retire. I have already invested $4,000 in a Roth IRA for 2012 and switched all of my Thrift Savings Plan contributions to the Roth option in May. My financial adviser said I could not invest more than a total of $5,000 in both Roth accounts for 2012 and told me to switch my contributions back to the traditional TSP. Is he correct, or can I invest the $4,000 in the Roth IRA and $17,000 in the Roth TSP? In other words, can I still invest the annual maximum of $17,000 in my TSP for 2012?

A. Your tax preparer is the person to guide you in this area. I can tell you, though, that the TSP Roth contribution limit is not affected by your Roth IRA contributions.

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Mike Miles is a Certified Financial Planner licensee and principal adviser for Variplan LLC, an independent fiduciary in Vienna, Virginia. Email your financial questions to fedexperts@federaltimes.com and view his blog at money.federaltimes.com.

2 Comments

  1. In as much as your “financial adviser said I could not invest more than a total of $5,000 in both Roth accounts for 2012” is wrong you may consider replacing with another advisor who knows what he is talking about.

    Roth IRA limit for 2012 is $5,000 ($6,000 for those 50+).

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