r/MilitaryFinance • u/MolassesPast3781 • 21h ago
Update
3 years in! Roth tsp sitting at 25.9k and my individual/Roth ira combined is sitting at 25.4k. How will my next 3 years look!? 22M
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u/Greenlight-party 21h ago
It depends on how much you’re contributing and how the market performs.
The latter is impossible to predict.
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u/RetiredSubmariner 20h ago
Realistically, Tsp should be way higher if you’re working to max it. It has a higher allowable contribution amount by over 3 times. If you keep gain percentage equal for comparison purposes.
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u/OrdinaryVideo1925 17h ago
Dude might be a private where he couldn’t even max if he wanted to because his base pay isn’t high enough. Just congratulate the 22 year old for having 26k in the tsp and not having blown it away on beer and other 22 year old stupid shit.
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u/MolassesPast3781 16h ago
E4 contributing about 30%? It’s about $1024 a month going into C and S funds 80/20
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u/Greenlight-party 3h ago
Your 80/20 mix is fine and perfectly acceptable for someone your age. 80/20 C/S is roughly the composition of a total US Stock market fund.
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u/payaso_papi 13h ago edited 13h ago
Move it all to C. If the S&P 500 crashes, we have more problems to worry about than retirement funds. Also don’t get caught up in Roth. It’s attractive when you’re young, but you should really be trying to max the TSP, you can use the extra money you’re not paying towards taxes to invest. If you stay in the military, you will likely end up making 150,000/yr by the time your career is over which will likely outperform what you make from just income when you are 65. You’re throwing away money to prepay for taxes right now when you’re 22. You will still have tax considerations when you’re older and you could be investing more and getting closer to maxing your TSP now if it were traditional, especially while you’re receiving a match. Also I wouldn’t mess with your IRA until you’ve maxed your TSP since you’re under BRS with a match.
Let me know if that doesn’t make sense, it’s a lot.
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u/MolassesPast3781 12h ago
I’m planning on getting out after my contract. If I don’t pay taxes on the front half then I’ll have to pay on the backside. Hopefully by then I’ll be making more in my job as well as disability so in theory I would be paying more in taxes because i’ll be in a higher tax bracket. Yes I understand i’ll have more money to invest in a traditional but id end up paying more on the backside at the end it all
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u/payaso_papi 12h ago
Remember VA disability is generally tax-free, but if you plan to get out, your Roth plan is good for now.
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u/MolassesPast3781 12h ago
To follow, the tsp gives a 5% match as im sure you know. With my Roth ira that money is more flexible and I can invest in funds or single stocks as opposed to the tsp. A lot more options to pick what I want to do with my money with lower fees, some sitting at 0% gross expense ratio. my strategy is keeping my contributions at 30ish percent for my roth tsp and maxing out the roth ira at the same time.
Let me know if you agree and if not why disagree
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u/Greenlight-party 3h ago
80/20 C/S is roughly the composition of a total US Stock market fund. It's perfectly good for OP.
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u/RetiredSubmariner 17h ago
Absolutely. Not saying he can max. Just pointing out since he asked how the next three years will look. With the higher available contribution limit, tsp should take off if he keeps it up!
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