Browsing: Roth TSP

Q. I have been investing in the traditional TSP during my entire career. I have approximately $585,000 in my account and plan to retire at 62 years old in 5 years from now. I’m contemplating changing my investments from the traditional to the Roth in order to lessen the tax burden later on in retirement when required minimum distributions kick in. My wife is self-employed and has been funding a Roth annually for the past 10 years. I began funding a Roth last year and we both plan to continue to fund a Roth for the next 5 years. Do you…

Here’s a pop-quiz question for you: How many partial lump-sum withdrawals are you allowed to take from your Thrift Savings Plan account during your lifetime? Go ahead, write down your answer. Everyone knows that the answer is one, right? In fact, that is the stated limit in every TSP publication that I can remember seeing. This limit is also one of a number of common reasons that TSP participants decide to roll their account assets from the best retirement investment vehicle in the United States into an individual retirement account after retiring. But, while the TSP’s withdrawal restrictions are inconvenient,…

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…

Q. I am a federal employee contributing the maximum to TSP (Traditional). I currently own a Traditional IRA and a Roth IRA, and my wife owns a Roth IRA. As our combined income will soon exceed the threshold for the standard approach to contribute to our Roths, I am investigating strategies to utilize the back door approach to making Roth contributions. The fact I still have a traditional IRA is the issue — it is comprised of $12,000 of after-tax contributions, and $48,000 of pretax earning thus far. If I use the back door approach, I would have a large…

Q. After 27 years of diligent saving and investing, I’ve accumulated well over $1 million in my regular TSP account. I also have over $70,000 in my Roth TSP account, and that portion is growing quickly. By the time I retire, I expect my Roth TSP balance will account for around 10 percent of my entire TSP account balance. After I retire at the end of 2017 (at age 62) and before I begin collecting Social Security (at age 66 or 70), I want to convert a good portion of my regular TSP account to Roth assets. The problem is,…