Q. I am 26 years old and I contribute 15 percent into my Thrift Savings Plan account. I have been reading suggestions on personal finance websites that I should consider placing a portion of my contribution into the Roth TSP to anticipate the possibility that I will be in a higher tax bracket around retirement. I was wondering what your opinion on this issue is and if it would be a good idea to place a portion of my TSP contributions in the Roth TSP.
A. I’m indifferent without any evidence that it will further your interests. It’s impossible to determine, in advance, that diverting some of your contributions to Roth will be beneficial. If a benefit is derived, it’s also impossible to determine, in advance, that it will be significant. Directing your contributions to Roth, rather than the traditional TSP, is agreeing to pay tax today in exchange for a possible benefit tomorrow. Without any clear evidence that it will be to your advantage, I guess I’d choose the simpler approach and contribute everything to the traditional TSP.