Rolling VCP into Roth


Q. I have received several inquiries about establishing Voluntary Contribution Plan accounts with the Office of Personnel Management, funding the account and then rolling those voluntary contributions into a conventional Roth plan administered in the private sector once the employee has retired.

I am a little skeptical about the prudence of this. It appears to me on the outside that this is simply a way of talking people into using the federal government to change the “color of money; read: launder” and then roll it into a Roth where a plan administrator will now make a fee on your hard-earned dollars.

It just sounds like it would not be in the best interest of the employee/soon-to-be retiree. My gut tells me this is wrong on so many levels.

A. This is a legitimate way to convert a taxable investment into a tax-free investment. The choice of investment custodians and securities is up to you and doesn’t necessitate higher costs.


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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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