December 19, 2015 at 1:50 am #17790AymanemGuest
Hey all, so I just stumbled upon this site and have not stopped reading all of the articles. To give you some background, I am 24 and active duty military currently only depositing 4% since I’m focusing on paying off credit card debt and stupid young decisions.
I have a roth tsp and a vanguard roth account. My question is, if you could increase funding, is it more beneficial to try and max out one before working on the other?December 19, 2015 at 2:06 am #17791JesseGuest
I am also 24. I am working to max out TSP first/per year then I will go vanguard. Compound interest is a greater effect with more money so max out tsp firstDecember 19, 2015 at 10:38 am #17792AnneParticipant
I don’t know that it really matters since there is no matching for the military in TSP. TSP has limited number of funds but very low expense ratio while Vanguard has numerous fund options. I would recommend putting more into TSP since it has a higher limit and with automatic deductions, I believe you save more (not spending what you don’t see).
One benefit of IRA outside of TSP is that you have more flexibility. For each year, you have until April 15 (or Tax Filing date) of the following year to contribute to your Roth IRA for the prior year. If you file your tax return in January or February for 2015 and get a refund, you can contribute that amount or any additional amounts up to the maximum to your IRA for 2015 until 15 April 2016.
Dave Ramsey recommends retirement savings of 15% after getting out of debt https://www.daveramsey.com/baby-steps
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