Q. Quite a few of us here in Afghanistan believe the new Roth IRA is an excellent investment. We are contributing tax-free money to receive tax-free contributions and earnings after we retire and meet withdrawal criteria. We leave Afghanistan in late February. Since we have been in a combat zone for two months, we plan to max out the Roth as much as possible. If we are able to max the Roth at $17,000, how much may we contribute to the traditional TSP/Roth TSP for the rest of the year? A. The TSP contribution limit applies to all of your TSP…
Browsing: Roth TSP
Q. I am in under FERS. If I retire after 30 years of federal service at age 58, can I start withdrawing my Thrift Savings Plan, or do I have to wait until I am 59½? I do not have any part of the TSP as a Roth. A. Under the circumstances you describe, you may begin withdrawals without penalty.
Q. Someone asked you online Oct. 8 if they could deposit funds into the Voluntary Contributions Program and transfer “the whole amount” into a Roth TSP. You said “yes.” The poster said they thought they could only transfer interest to TSP. By asking if they could transfer “the whole amount,” I believe they were wondering if they could transfer both contributions and interest. You have said as recently as an answer given on Sept. 24 that “You’ll have to use a Roth IRA for the after-tax portion of the VCP account,” and gave a corrected answer to a question posted…
Q. I’m CSRS. If I deposit funds in my Voluntary Contributions Program, I thought I could only transfer interest gain to TSP. Can I transfer the whole amount if I choose Roth TSP? A. You may not transfer or convert money into the Roth TSP. You could roll the money over to a Roth IRA, however.
Q. I have been in the service 15 years and plan on being in for at least five to nine more years. I have been putting in 26 percent monthly to the Thrift Savings Plan for the past five years. I have three Roth IRAs, as well. Should I start the Roth TSP, put in $13,000 to $15,000 a year, continue my Roth IRAs and move all my funds from my regular TSP to Roth TSP? A. I can’t tell you what you should do, since I don’t know enough about your situation to do so responsibly. In general, I recommend…
Q. My husband and I are both federal employees. My husband is 30 and has 10½ years. He contributes to the G Fund and, from what I can tell from our leave and earnings statement, it is 5 percent. I am 28 and have three years. I also have a 5 percent contribution to G Fund per our LES. What fund do you recommend we contribute to? We would like to start now to ensure we have a decent retirement. Do you recommend us investing in the new Roth? A. You should contribute as much as you can afford to…
Q. I am a CSRS employee who plans on retiring in 2013. I want to open a Voluntary Contribution Program account and deposit after-tax money in that account, and then, at retirement, transfer the deposit into Roth TSP, and any earnings into traditional TSP. Is that allowed? A. No. You’ll have to use a Roth IRA for the after-tax portion of the VCP account.
Q. I am 29 years old and serve in the Air Force. I contribute the maximum $5,000 amount to my Roth IRA every year, and have a few thousand dollars in the standard Thrift Savings Plan. I am concerned about the lack of investing options besides the G, F, S, C, I and L funds within the TSP. With the new Roth TSP option, would it be possible for me to continue to contribute $5,000 directly to my Roth IRA, then contribute $17,000 to a Roth TSP, and finally roll that $17,000 over to my Roth IRA each year? A. Your participation…
Q. I attended a seminar given by MetLife Financial people about Roth TSP, IRAs, etc., and was told that even if I am working at 70½ and not retired that I still have to make a withdrawal of my TSP percentage. However, in the booklet “Withdrawing Your TSP Account” on Page 3 under withdrawal deadlines, it states in the second sentence: “If you are still a Federal employee employed at 70½, your required withdrawal must be by April 1 of the year following the year you separate.” I told the lady what our TSP booklet said, but she said it…
Q. I’m active-duty military, maxing out one Roth IRA. I was interested in opening a Roth TSP, as well, but a financial adviser at my bank recommended opening a second Roth IRA in my wife’s name and maxing it out first before contributing anything to a Thrift Savings Plan. This struck me as odd because it would leave my retirement money spread over three separate accounts. I couldn’t max out the TSP but could probably contribute more than $5,000. Is my financial adviser (free service from the bank) right or just trying to get me to open another IRA at…