I’m an O-1 in the Army Reserve. Commissioned recently in 2023 and am reaching my 3 year mark in service with a unit. I’m currently contributing 5% to TSP and 5% to Roth. I switched my TSP funds to the C fund to maximize my growth over time, knowing it’ll be at a higher risk.
What are your tips for TSP and Roth starting out? I work full time for a private company in California making 22 an hour, 40 hours a week.
I have some tuition and some personal debt from college I owe and some personal for housing.
Anyone got tips just starting out?
Posted by Ok-Carpet5248
1 Comment
TSP has a traditional and Roth component. You can do one or the other, but they’re both TSP
A Roth IRA is a personal retirement account (re:individual retirement account) with much different rules
I suggest them both, but if you’re only doing TSP that’s fine too.
For TSP, I do 100% C, but you can keep it in a Life cycle fund or put 80% towards C and 20% towards S funds. It’s a coin flip who comes out ahead in 30 years
As for amounts it’s highly dependent on income, debts, emergency fund. If your interest rate on your debt is above 6%, I would focus on debt before upping contributions, but I tend to be more risk averse. If it’s less than 6%, you have 3-6 months of an emergency fund, and you’re not saving for anything in particular in the next 5 years. I like to keep my contributions between 20-35%. Just remember that your TSP contribution limit of 23k is SHARED with your civilian company. So if you contribute 10k to 401k with civilian company, you can only do 13k with TSP. The matching doesn’t count towards that limit