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There are a slew of options when rolling over your TSP. Many revolve around suitability and asset allocation. Vice letting the TSP sit stagnant, reach out to me and we can look at what's the best option for you.
Investing
Retirement
Transition
Planning
Personal Finance
Edited >1 y ago
Posted >1 y ago
Responses: 4
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After retirement I "Transferred" my TSP into an IRA (Traditional). This way I can avoid paying taxes on the full amount that is the result of putting it into a Roth IRA.
Through the IRA, I can control how much of it I can allocate into my Roth every year. I'm only paying taxes on the amount I converted. This lets me control my tax bracket. This is my experience so far on TSP matters. This is not financial advice.
When we retire we are all in a different financial situation. This is why a Certified Financial Planner (CFP) is certified resource available. They are regulated by the SEC, FINRA and are require to be fiduciary (clients best interest).
Through the IRA, I can control how much of it I can allocate into my Roth every year. I'm only paying taxes on the amount I converted. This lets me control my tax bracket. This is my experience so far on TSP matters. This is not financial advice.
When we retire we are all in a different financial situation. This is why a Certified Financial Planner (CFP) is certified resource available. They are regulated by the SEC, FINRA and are require to be fiduciary (clients best interest).
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Sgt Robert Novotny
Yes sir. My mentor is a '94 West Point grad (so we get into Go Navy, Beat Army discussions often) and has many designations that have catered to helping our veterans. CFP is one of them. Takes a few years of dedication to earn the CFP designation. Just like in the Marine Corps earning my black belt. That's how I've approached every new exam or designation coming my way. It just takes time. Learn from your mentors.
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When I go out in 2012 I rolled over my TSP into a Roth and everything worked out ok. I wanted to have more control over my money.
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Sgt Robert Novotny
Are you getting positive management of your account from a professional? Or are you managing the asset allocations yourself?
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SSG Phillip Cox
At first I managed my own money. Now The Mutual Fund Store manages my money. They are a fee based firm that charges a percentage of the account to manage. I prefer this to firms that are commissioned based. To me a fee based broker is a clear honest approach. The more money I make, the more my advisor makes.
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Sgt Robert Novotny
I've been out (retired) since 2012, and have about $26K sitting stagnant in my own TSP. What are my options? I've looked into IRA's, both Roth and Traditional. What would prevent me from paying taxes, or at least minimize the taxes I might have to pay? I tried talking to a USAA Financial Advisor, and he was worthless.
I've also thought about withdrawing the money as I do have a big purchase I want to make (don't need to, just want to). Again, what would be the taxes I would have to pay if I decide to withdraw the entire amount?
I've been out (retired) since 2012, and have about $26K sitting stagnant in my own TSP. What are my options? I've looked into IRA's, both Roth and Traditional. What would prevent me from paying taxes, or at least minimize the taxes I might have to pay? I tried talking to a USAA Financial Advisor, and he was worthless.
I've also thought about withdrawing the money as I do have a big purchase I want to make (don't need to, just want to). Again, what would be the taxes I would have to pay if I decide to withdraw the entire amount?
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Sgt Robert Novotny
If you plan on taking the withdrawal, no matter where you put it now you're going to see those taxes and penalties. We suggest saving 20% of what you withdraw when it comes time to pay the piper come tax time. There are, like with anything, exceptions to the penalties for certain dollar amounts. If you want - shoot me an e-mail to [login to see] and we can get into specifics and spitball some scenarios that work best for you and hardest for your dollars.
Thanks for reaching out! You can also see my professional website to learn more about me before reaching out, if you'd like. robertnovotny.nm.com
God Bless, and thank you for your service, John.
Thanks for reaching out! You can also see my professional website to learn more about me before reaching out, if you'd like. robertnovotny.nm.com
God Bless, and thank you for your service, John.
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SSG Phillip Cox
I did have my money at USAA for a bit and found the investment services less than desireable.
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Dear SGT Novotny,
I have some ideas for you, based on my education and experience. Find a discount broker (Schwab, TD Ameritrade, Scott Trade, etc.) with lots of investing alternatives at relatively low cost. They will help you set up an account and roll over your TSP into a tax-qualified account. If you are eligible, I strongly recommend that you consider setting up a Roth IRA, since it will grow tax-free and you can (eventually) withdraw it tax-free. Nothing beats tax-free, especially in the years to come.
Do some homework and learn the basics of investing. Please, do NOT buy loaded funds and pay some sales agent a big fee to sell you a fund or a stock. Loaded funds do NOT perform well enough to justify their high cost. Consider investing in no-load mutual funds, or even better, Exchange Traded Funds which are VERY low-cost ways to get into market segments like Technology, Energy, Bio-Tech, Utilities, etc.
As well as rolling over your TSP, I recommend that you set up a savings account and start to build up a reserve fund of three to six months in cash. That gives you the security to not have to cash in your investments if times get more difficult.
I wish you well. You have time on your side in which you can invest wisely and get rich slowly. Be disciplined and think carefully about how you spend your money. Don't get into credit card debt. If you find a good job with some money to spare, then set aside as much as you can in a 401(k), at least enough to get all of your employer's matching contribution. If you still can, contribute to your Roth IRA as well.
The more you put into tax-advantaged investments, and the more time you have to let them grow, the sooner you will be financially independent. Being debt-free and having options for the future because you've saved and invested well yields financial independence. That is true freedom.
Best Regards,
Hugh Blanchard
MS, Business Administration
MAJ, US Army (Retired)
I have some ideas for you, based on my education and experience. Find a discount broker (Schwab, TD Ameritrade, Scott Trade, etc.) with lots of investing alternatives at relatively low cost. They will help you set up an account and roll over your TSP into a tax-qualified account. If you are eligible, I strongly recommend that you consider setting up a Roth IRA, since it will grow tax-free and you can (eventually) withdraw it tax-free. Nothing beats tax-free, especially in the years to come.
Do some homework and learn the basics of investing. Please, do NOT buy loaded funds and pay some sales agent a big fee to sell you a fund or a stock. Loaded funds do NOT perform well enough to justify their high cost. Consider investing in no-load mutual funds, or even better, Exchange Traded Funds which are VERY low-cost ways to get into market segments like Technology, Energy, Bio-Tech, Utilities, etc.
As well as rolling over your TSP, I recommend that you set up a savings account and start to build up a reserve fund of three to six months in cash. That gives you the security to not have to cash in your investments if times get more difficult.
I wish you well. You have time on your side in which you can invest wisely and get rich slowly. Be disciplined and think carefully about how you spend your money. Don't get into credit card debt. If you find a good job with some money to spare, then set aside as much as you can in a 401(k), at least enough to get all of your employer's matching contribution. If you still can, contribute to your Roth IRA as well.
The more you put into tax-advantaged investments, and the more time you have to let them grow, the sooner you will be financially independent. Being debt-free and having options for the future because you've saved and invested well yields financial independence. That is true freedom.
Best Regards,
Hugh Blanchard
MS, Business Administration
MAJ, US Army (Retired)
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Sgt Robert Novotny
Rally point keeps changing the original question. Much appreciated for the advice and guidance. I've been focusing my financial practice on rolling TSP into IRAs to help with first time home buyers exemptions.
There are a lot of stock traders that work in loaded funds and stocks, I'm not in that business. Being a planner, I'm all asset allocation and planning for disbursements in the most tax effective ways.
There are a lot of stock traders that work in loaded funds and stocks, I'm not in that business. Being a planner, I'm all asset allocation and planning for disbursements in the most tax effective ways.
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MAJ Hugh Blanchard
Good for you, I did not get that from the question presented in the original post. I did not mean to preach to the choir.
Regards,
Hugh
Regards,
Hugh
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Sgt Robert Novotny
Sometimes the choir needs to receive the preaching also. Thanks for contributing!
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