Starting off small

This topic contains 1 reply, has 2 voices, and was last updated by  Anne 3 years, 1 month ago.

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  • #17696

    dpm911
    Participant

    I have had my TSP going for about 4 years now and I don’t have very much in at this time (roughly about ~$7k) I only contribute about 10% and just recently went up an extra 2%. I can not go to much higher than this due to fact that am I raising a family and money is tight. I had my contributions going in to a normal TSP for the vast majority of its life and only just recently (2 months ago) stopped contributions to TSP and rerouted the 12% to roth TSP. I’m using this site as a guide and switched my contributions from what they where (G 10% C,I,S, 30% each)
    to the 85/15. Is there anything else I can do to help push this along?

    #17701

    Anne
    Participant

    You are just where you need to be right now DPM. It use to be that contributions were limited to 10%. With the 5% match, you are contributing 17% that is way more than most Americans today. My main suggestions is that when you get any increase in pay (Promotions, step increases, COLAs or bonuses), continue to increase your contribution percentage. Can’t really comment on the Roth within TSP as all my contributions are traditional and having both seems confusing based on the rules related to distributions being done proportionally. One advantage of the Roth in a separate account is that your beneficiaries receive the proceeds with the same tax free benefit on the earnings within the Roth account. Finally, you may want to consider a Health Savings account for medical expenses that will reduce your income taxes since your Roth contributions are after tax.

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