Comments on: Disadvantages to Investing in the Thrift Savings Plan

By: Ryan

Ryan — Wed, 20 Jan 2010 14:47:16 +0000

Thanks for the info, Christina.

By: Christina

Christina — Tue, 19 Jan 2010 21:23:16 +0000

While TSP data still can’t be imported into Quicken, balances, gains, and losses can be tracked online on Mint.com.

By: Ryan

Ryan — Mon, 21 Apr 2008 11:47:24 +0000

Brooke, I agree that it is a pain to transfer or rollover 401(k) plans with every PCS, but that is a much better option than cashing it out! The penalties are ferocious! However, It’s just not possible to combine a spouse’s money with the TSP though because, like an IRA or 401(k), they are only designed for the individual.

Then think about what would happen in the case of a divorce (I’m not implying anything for your situation, but that is the reality of many marriages nowadays)… How would the money be split? What if there was an agreement that one spouse would make all the retirement contributions from his/her check while the couple lived on the other check? It would work great until there was a need to split the money later.

I think it would just get to complicated.

By: Brooke

Brooke — Sun, 13 Apr 2008 00:43:44 +0000

I wish they would let us put a spouse match in…since our spouses have to follow us around, it’s a headache to have them have to rollover their 401(k) money everytime we PCS. It would be nice if I could auto-deduct money from my paycheck and put it in my spouse’s 401(k) (or TSP, whatever), and we could also port it when we PCS. I don’t even know where to start with this idea, though.

By: Matt Melton

Matt Melton — Sun, 06 Apr 2008 06:41:09 +0000

Well put:

“No matching funds for military. Unless you are civil service, you do not get matching funds. In that case, it is usually better to max out your Roth IRA before contributing to the TSP.”

There is some talk about altering the 20 yr pension for matching contributions. This is a poor way to implement the change. The government should keep the system the way it is and let the “market timers” make up the difference in annual returns

By: Ryan

Ryan — Sun, 30 Mar 2008 01:04:20 +0000

Kirk, great comment.

The Roth is great for younger military members because it gives them longer tax free growth and more tax diversification. Since they are already in a low tax bracket, the TSP won’t lower it.

In my opinion though, anyone just starting out can’t go wrong with either the TSP or a Roth IRA. The point is to get started. I also think the TSP is a great place to begin because there aren’t too many investment options, which can be overwhelming to new investors.

By: Kirk

Kirk — Sun, 30 Mar 2008 00:46:05 +0000

Good points here. In some cases, especially younger military members, a Roth IRA is a better choice than the TSP even though the TSP has extremely low costs for its funds.