TSP contributions and Roth


Q. I am a GS-14 criminal investigator with 16 years covered service, and I am expecting to contribute to the Thrift Savings Plan for another 10 years or so before retiring. I have been contributing the TSP maximum for the past 10 years. What is your guidance with the Roth option? Should I scale back my TSP contribution to the 6 percent minimum to capture the matching contributions and invest the rest with the Roth option?

A. Without a good reason to do otherwise, I prefer the tax-deferred 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.


  1. The Roth TSP has it’s benefits: it can be used as an emergency fund (principal only), you can start taking out money at 59 1/2 without penalty or taxes on earnings.

    But from what I can tell, the advantage to doing a private non-TSP Roth is that you have a great variety of options on where to put your money, from a single mutual fund to several different ones or money markets, to stocks only and many other combinations of investments.

    It all depends on if you are satisfied with the limited options TSP gives you. If you want to take a greater risk with some of your money, or if you want to only support ethical/green companies, or if you want to buy high paying dividend stocks a private Roth is the way to go.

  2. There is a problem with the initial question, which should be addressed. You asked, “Should I scale back my TSP contribution to the 6 percent minimum to capture the matching contributions and invest the rest with the Roth option?” If you decide to go with the Roth TSP, you can put the entire amount in and still receive the matching funds. The government match will go into the regular non-Roth TSP, but it does not limit where you put your contributions.

    Also, the first commenter talks about non-TSP Roths. That’s really comparaing apples and oranges. The Roth TSP and a Roth IRA are two completely different things, which have completely different benefits and limitations.

  3. The contributions to an ROTH IRA can be used as an emergency fund but TOM’s assertion that a Roth TSP can also is the first I’ve heard of it. Frankly I doubt if that is correct.

    The OP (mentioning 6%) is mis-informed; the correct percentage is 5% but as long as the OP is contributing 5% of his income it doesn’t matter if he is investing in the traditional TSP or the Roth TSP – he will receive the full 5% match.

    “Private non-TSP Roth” is an poor description. Does TOM mean a Roth IRA and or a traditional IRA?

    If the OP hasn’t already done so, he should consider investing in a ($5,500) Roth IRA. If 50+, the Catch Ups for both the TSP and IRA.

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