I’m getting ready to EAD (enter active duty) here in a couple weeks as a butter bar (flame me ik it’s coming) and wanted to reach out to gain advice on what some of the best ways are to invest. Other than matching the 5% or more for TSP, I don’t really have any great idea of what to do. I hear IRAs are a good choice but still don’t know much about them as well as S&P500. Does anyone have advice or recommendations on where to look regarding relevant and useful information about potential options?
New LT looking for advice
byu/Better_Soft5928 inMilitaryFinance
Posted by Better_Soft5928
2 Comments
The best advice I can give you is to put forth effort into researching things before asking for help. This will ultimately lead to you being a more self sufficient leader. Generic “I’m new, how I save?” has been asked about a thousand times. The answer is the same barring unique circumstances which your post didn’t have. The sub search bar would be a good first place to start followed by Google to clarify the meaning of any terms you see that you don’t understand.
Go to the finance for chart in the sub’s wiki. TSP at 5% to get the match, then emergency fund and then more to either TSP or IRA. The recommendation is to only go to taxable brokerage once retirement accounts are maxed. Just as reference, if you’re not going to have more than 23k to drop into retirement, you can just simply do TSP with no IRA.
For an IRA, the absolutely easiest set it and forget it is to go through a brokerage with a ROTH IRA that allows auto investing into a super low fee ETF like VOO or VTI. Fidelity and E-Trade are the main two that I know of that allow this. VOO is basically the C fund in TSP (S&P 500 index). Just buy on regular intervals through the year to meet the 7k annually. The benefit of the IRA is that you can choose more aggressive ETFs like QQQ which is far more tech heavy in following the Nasdaq 100 (logic is greater risk, greater reward… But down years do clobber QQQ more than S&P which translates to me as an ETF on discount to buy more long term).
BL – follow the chart and don’t forget to adjust the emergency fund as your circumstances change such as getting married, having kids, buying/owning a home.