Very good info. Thanks to people like you and other food financial advisors, I have since started switching from traditional to Roth in my TSP. Too bad I didn't research this before putting $60k into my traditional side in my TSP. From here until around 15 years from now, it's going to be all Roth (future contributions). Once I turn 59 and a half, I'm most likely going to transfer my TSP retirement into a IRA, then roll it into a Roth IRA within that same broker. I'll be getting some financial advice before I make such a huge decision though. You don't want to be moving so much money before a pro analizes and tells you all the pros and cons. Thanks for another wonderful video and info!
Dallen, simple question? Four years to retirement, wife six years, both government workers. I was thinking of switching us both over to Roth to have more cash at our disposal when we retire. Is this a smart move? No other reason, just more cash to pay off cars or other bills. Love your videos and thanks for your time and great advice!
After researching Roth vs Traditional in the TSP and the federal employees, since I have some benefits after retirement that will most likely keep me in the same tax bracket, I'm starting to put what I add to my TSP as Roth. Hopefully the $60k that I already have in there will not throw this off too much 😢. I wish I would have done that since day one. I also moved my TSP balance from the L2040 fund because it was only earning like 7.5% after like 10 years? But that's another subject. Thanks for the video!
Great information. However, to apply it, one needs to consider the distribution options TSP has. It appears to me that one cannot choose to withdraw x amount of dollars from one's traditional TSP and x amount of dollars from one's Roth TSP, or only funds from traditional TSP or only funds from Roth TSP, rather when one requests a withdrawal, TSP apportions the withdrawal from both your Traditional and Roth holdings based on what percentage of Roth and Traditional makes up your total TSP holdings. Is my understanding correct?
Dallen, love the videos and help you provide. I plan on retiring next year at my MRA. I have a relatively small Roth outside of the TSP and just started putting money into the ROTH TSP to start building more tax free money for later in life or for my heirs. My first Roth TSP contributions just went in this last pay period but when looking at my TSP account online, it does not distinguish between Traditional and Roth. I plan to transfer a good portion of my TSP over to an IRA upon retirement. I was thinking of leaving the ROTH TSP in the TSP until 72 and then rolling that over. How would I know how much of my money is traditional vs Roth when I want to move that money? Also it appears any interfund transfers apply equally to both accounts. Seems like another of the negatives about the TSP. Thanks! Wayne
It might be that the deposit for the last pay period has not hit the TSP website yet? My account shows a Traditional and a Roth balance. I can't imagine it being different for different agencies. Yes, you can't transfer money only in the Traditional account. Or, in the Roth account. Both have the same allocation.
@@PlanYourFederalBenefits Yeah, another thing that sucks about the TSP. Both the Roth and traditional TSP are one. I have the same issue. I recently started putting money towards the Roth TSP, and it just keeps adding towards the traditional ($60k that I already have there). I'm assuming that a formula would be used to see how many less taxes you would pay once you move your retirement out of the TSP? 🤔
I want to maximize my Roth TSP, but also maximize the agency match on my traditional account. With the new '22 limit now at $20,500, that's $788 per pay period. How do I split the $788 to maximize Roth and still ensure the full match on the traditional TSP?
Hey Christopher, The good news is that you will get matching contributions even when you only put money in the Roth. However, the money that your agency contributes will always go in to the traditional side. So technically you can put all your money in the Roth side and still get the match.
Hello boss man. More videos is see more confused I get. If u live in tax free state then Traditional TSP May be better but u have to pay federal taxes correct? What percent is the federal tax u have to pay. I think I’m in the 22 percent tax bracket so Traditional works better? Thanks please reply. I really enjoy your videos.
I've invested roughly around 30k on my tsp back when i was active duty back in 2004. I just left it there and forgot it not knowing how it's doing. I want to withdraw all of it but im out of the country. How can i access it?
Hey dallen, A usps employee....they changed the 5% match...its 3% dollar fer dollar, 2% 50 cents on the dollar. What nerve...use to be all 5%..match..30yrs +...in service time to go....
Actually, it is 1% no matter what. Then, 1 for 1 to 3%. Then 1% gets you .5% for the next 2. Which equals 5% for 5%. If you put in 4%, you receive 4.5%.
Very good info. Thanks to people like you and other food financial advisors, I have since started switching from traditional to Roth in my TSP. Too bad I didn't research this before putting $60k into my traditional side in my TSP. From here until around 15 years from now, it's going to be all Roth (future contributions). Once I turn 59 and a half, I'm most likely going to transfer my TSP retirement into a IRA, then roll it into a Roth IRA within that same broker. I'll be getting some financial advice before I make such a huge decision though. You don't want to be moving so much money before a pro analizes and tells you all the pros and cons. Thanks for another wonderful video and info!
Dallen, simple question? Four years to retirement, wife six years, both government workers. I was thinking of switching us both over to Roth to have more cash at our disposal when we retire. Is this a smart move? No other reason, just more cash to pay off cars or other bills.
Love your videos and thanks for your time and great advice!
After researching Roth vs Traditional in the TSP and the federal employees, since I have some benefits after retirement that will most likely keep me in the same tax bracket, I'm starting to put what I add to my TSP as Roth. Hopefully the $60k that I already have in there will not throw this off too much 😢. I wish I would have done that since day one. I also moved my TSP balance from the L2040 fund because it was only earning like 7.5% after like 10 years? But that's another subject. Thanks for the video!
Right on time.
when figuring out the FRES employee's high three, do you include the locality pay or just basic pay in the calculation?
Yes you include locality pay!
Great information. However, to apply it, one needs to consider the distribution options TSP has. It appears to me that one cannot choose to withdraw x amount of dollars from one's traditional TSP and x amount of dollars from one's Roth TSP, or only funds from traditional TSP or only funds from Roth TSP, rather when one requests a withdrawal, TSP apportions the withdrawal from both your Traditional and Roth holdings based on what percentage of Roth and Traditional makes up your total TSP holdings. Is my understanding correct?
Dallen, love the videos and help you provide. I plan on retiring next year at my MRA. I have a relatively small Roth outside of the TSP and just started putting money into the ROTH TSP to start building more tax free money for later in life or for my heirs. My first Roth TSP contributions just went in this last pay period but when looking at my TSP account online, it does not distinguish between Traditional and Roth. I plan to transfer a good portion of my TSP over to an IRA upon retirement. I was thinking of leaving the ROTH TSP in the TSP until 72 and then rolling that over. How would I know how much of my money is traditional vs Roth when I want to move that money? Also it appears any interfund transfers apply equally to both accounts. Seems like another of the negatives about the TSP. Thanks! Wayne
It might be that the deposit for the last pay period has not hit the TSP website yet?
My account shows a Traditional and a Roth balance. I can't imagine it being different for different agencies.
Yes, you can't transfer money only in the Traditional account. Or, in the Roth account. Both have the same allocation.
You should be able to tell how much is each on your statements. And you are right that you can't invest the traditional TSP and Roth TSP differently.
@@PlanYourFederalBenefits Yeah, another thing that sucks about the TSP. Both the Roth and traditional TSP are one. I have the same issue. I recently started putting money towards the Roth TSP, and it just keeps adding towards the traditional ($60k that I already have there). I'm assuming that a formula would be used to see how many less taxes you would pay once you move your retirement out of the TSP? 🤔
Except for the low TSP fees, the ROTH IRA has so many advantages, e.g., no RMDs ever. Although you could roll-over ROTH TSP into ROTH IRA.
Actually, places like Fidelity, Schwab and Vanguard have lower fees than the TSP.
Thanks for sharing!
I want to maximize my Roth TSP, but also maximize the agency match on my traditional account. With the new '22 limit now at $20,500, that's $788 per pay period. How do I split the $788 to maximize Roth and still ensure the full match on the traditional TSP?
Hey Christopher, The good news is that you will get matching contributions even when you only put money in the Roth. However, the money that your agency contributes will always go in to the traditional side. So technically you can put all your money in the Roth side and still get the match.
Does taking money out of a Roth TSP raise your Adjusted Gross Income like the normal TSP? I would be taking out after 59 1/2 to avoid penalties.
No, It would not affect your AGI.
Hello boss man. More videos is see more confused I get. If u live in tax free state then Traditional TSP May be better but u have to pay federal taxes correct?
What percent is the federal tax u have to pay. I think I’m in the 22 percent tax bracket so Traditional works better? Thanks please reply.
I really enjoy your videos.
Correct, you'll have to pay federal even in a tax free state
@@PlanYourFederalBenefits Thanks sir.
I've invested roughly around 30k on my tsp back when i was active duty back in 2004. I just left it there and forgot it not knowing how it's doing. I want to withdraw all of it but im out of the country. How can i access it?
I would call the TSP to get access to your account.
Hey dallen, A usps employee....they changed the 5% match...its 3% dollar fer dollar, 2% 50 cents on the dollar. What nerve...use to be all 5%..match..30yrs +...in service time to go....
Actually, it is 1% no matter what. Then, 1 for 1 to 3%. Then 1% gets you .5% for the next 2.
Which equals 5% for 5%.
If you put in 4%, you receive 4.5%.
Good point!