I’m about to promote and was thinking of opening a Roth IRA in addition to my TSP to contribute the extra money. My TSP has 80k (giving 12% each month). My friend suggested I just put the extra money into TSP since the returns will be greater with more money. I have 8 years of service left until military retirement. What are your thoughts? Should I just focus on maxing out my TSP? Thanks for your input!
Opening a Roth IRA in Addition to TSP?
byu/the_cool_guy_club inMilitaryFinance
Posted by the_cool_guy_club
3 Comments
IRA. It doesn’t matter if you have 10 accounts with $100 or 1 account with $1,000, invested in the same thing will yield the same money.
IRAs are cheaper (in the right investments) and more versatile.
Get match, get Roth IRA maxed, max tsp in that order
The biggest difference is investment options in an IRA. If you want to weight yourself heavier into tech, multiple index funds offer this sector alone and others allow for just the nasdaq index (QQQ for example). QQQ long term has outdone the S&P (C fund in TSP), but has been more volatile. And by volatile, it took a long time (~15 years) to recover from the dot com crash of 2000… But it was an amazing accumulation period of you were an investor, and NASDAQ holdings in 2024 are quite different from the dot com era… As in profitable for starters.
For simplicity though, just doing your TSP may be your best bet.