I'm a 27yo (M) in the USMC, with six years of active duty service. I plan to serve for 20 years in the military or government. Recently, I increased my Thrift Savings Plan (TSP) contribution to 30%. Additionally, I have an Indexed Universal Life (IUL) insurance policy, to which I contribute $300 monthly, consistently since last year. I'm wondering if I'm optimizing my retirement savings strategy or if I should adjust my contributions, potentially allocating more to my TSP and less to my IUL.
I just want a proactive approach to my retirement plan and know how to allocate my resources for my long term goal.
Please anything would help.
USMC active duty seeking retirement strategy advice
byu/LetSubstantial9827 inMilitaryFinance
Posted by LetSubstantial9827
1 Comment
Personally I’d reconsider the IUL. For context, I’m about the same age with about the same amount of TIS. I have a $1M term life policy with USAA that is $32.50 a month. You don’t mention it in your post, do you even have a spouse/kids that would need your life insurance? Regardless, if you did a term life policy, you can take that extra ~$270 and save/invest outside an insurance vehicle. That IUL stinks of First Command. If you’re with them, ditch them now. Honestly, whoever sold you that IUL ditch them.
Your TSP contributions are good. It doesn’t particularly matter but if you wanted to diversify you could put some of that towards a Roth IRA instead.
Lastly, remember that TSP and IRAs cannot be accessed until age 59.5. At 20 years of service you’ll be about 42 years old. If you don’t plan on getting another job, you’ll probably want savings outside of a retirement account to supplement your pension/disability payments until you can access your TSP and later social security.