Best plan for maximum returns


Q. I have been using a Vanguard Roth IRA Target Fund for my retirement account. Now that I work for the federal government, I have a Thrift Savings Plan standard account and contribute the additional 5 percent to take full advantage of employee matching. I’m 37 and plan on working until at least 67. I believe my best bet is to just keep maxing out my Vanguard Roth IRA, taking full advantage of my employee matching and putting away anything extra I can into my Vanguard Roth IRA. Do you think that is my best bet, or should I stop investing in the Vanguard account and:

a.) Start maxing out the standard TSP with employee contributions?

Or b.) stop investing in the Vanguard IRA, keep investing the 5 percent to take advantage of employee matching in the standard TSP account and max the rest of my allowable annual contribution in the Roth TSP.

The reason I think I should stick with my Vanguard IRA and 5 percent employee matching instead of Option A or B is due to the advantage of dollar cost averaging from all of the years I already have invested in the Vanguard IRA.

A. I prefer maximizing the TSP contribution first, but it probably won’t matter much in the grand scheme of things. Your dollar cost averaging argument makes no sense, however, and should not be factor in your decision-making.


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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 and view his blog at

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