Starting TSP at 39 years old


Q. I am 39 years old, an officer of 14 years in the Marine Corps and married (she’s 37) with four beautiful children. I have a car payment worth $25,000 and don’t own a house or mortgage. I have spent the better part of the last six years paying off my student loans, which were more than $69,000. We are, thankfully, now in a position to begin investments, especially considering we have solid emergency savings established and very little consumer debt (the car is it and we don’t have credit card debt).

I am considering starting the Roth TSP for myself and a Roth IRA for my wife who is a stay-at-home mother. We don’t exceed the income threshold to contribute, and we file jointly. We can contribute $1,000 each month, and we’re looking to put $500 away for her into a moderately aggressive fund through Vanguard or another firm and my $500 toward a C Fund using Roth TSP. I deploy for short periods of time to tax-exempt areas around the globe, so a Roth TSP seems like a good way to contribute more than the $5,500 threshold. I think it’s safe to assume we can handle some risk. We have a target age of 65 for retirement.

Where would you and how would you begin these two Roth investments if you were in my shoes?

A. I’d put the Roth TSP investment into the following aggressive allocation:

  • 55 percent C Fund.
  • 26 percent S Fund.
  • 9 percent I Fund.
  • 6 percent G Fund.
  • 4 percent F Fund.

If you rebalance to this allocation at least once per year, it will produce an expected annual return of about 12 percent with a standard deviation of about 18 percent.

The Roth IRA I would open at a discount brokerage house (Schwab, Fidelity, TD Ameritrade, E Trade, etc.) with the contributions going into a similar allocation using Exchange Traded Index Funds (ETF) like these:

  • 55 percent IVV.
  • 26 percent IWM.
  • 9 percent IEFA.
  • 6 percent SHY.
  • 4 percent AGG.

About Author

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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