Posted on Nov 11, 2013
LTC Mel Magsino
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I've read than only about 40.4% of active duty service members contribute to the TSP despite its many benefits and advantages. Why isn't this percentage significantly higher?<br>
Posted in these groups: 7a1e50f4 TSP
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SFC Platoon Sergeant

Throughout my military career, I have had many leaders recommend investing in the TSP.  I never wanted to because it didn't seem like the best investment option because investors will need to pay taxes on the earnings when it is withdrawn in the future.  Since October 01, 2012 the Army has had a Roth TSP in place.  To me, this seems like a much better investment option for a majority of Soldiers because contributions are already taxed at the investor's current tax rate, but will be tax free upon withdrawal in the future.  Since many Soldiers pay such a low tax rate (factoring in the already low tax rate due to income level, the earned income tax credit, any child tax credits, and any education tax credits), that this can be a virtually tax free way to invest.


Do you invest, and if so, do you use either of these options or do you use another method to invest?  I use the Roth TSP and have realized about a 6% gain since starting in Oct 12.

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