These are my top recommended credit cards for this month. Some have $450-550 annual fees waived exclusively for US military personnel.

The editorial content on this page is not provided by any of the companies mentioned, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author’s alone.

A buddy of mine recently asked:

Can you double dip Roth TSP and Roth IRA? (Contribute the maximum to both plans in one year)

YES! Technically, I wouldn't call it double dipping, because the IRS treats them completely differently. The Roth TSP is treated as an “employee retirement plan” while the Roth IRA is an “Individual Retirement Account.”

Your 2013 contribution limits are:

  • Roth TSP: $17,500
  • Roth IRA: $5,500

So if you were to deploy or go TDY to a combat zone at any point, during those months you were deployed you could put up to $23,000 of pay into your combo Roth TSP + Roth IRA.

That's $23,000 that goes in tax free, grows tax free, and eventually pays out tax free. That's like some 1%-er, Cayman island level tax planning right there.

Roth TSP vs. Roth IRA

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The AMEX Platinum offers:

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These benefits make it my top recommend card.

If you already have an AMEX Platinum card, check out the other AMEX cards, Chase credit cards, and this month's top recommended credit card bonuses, most with no annual fees for US military personnel.

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3 thoughts on “Roth TSP vs. Roth IRA

  • July 16, 2018 at 20:35
    Permalink

    While you make many good points in your posts, you needed to relook at the guidance for taxation of Roth contribution from tax-free pay as you are unfortunately mistaken…

    Reply
  • February 20, 2013 at 05:04
    Permalink

    I keep TSP in the back of my mind, but I’m mostly worried about the “bridge” income between this career and actual retirement, so I’m privileging Lending Club, savings, and other short-term investments. Plus, watching my TSP grow at an anemic rank after getting tanked a few years back has deterred me as well.

    Reply
    • February 20, 2013 at 13:52
      Permalink

      I like to call it the “gap” income/assets, to cover from early retirement (right now I’m aiming for 40) to when I can access my retirement specific accounts (TSP, IRA, etc). Same concept though. The more I learn about the Roth option TSP and how low the expense ratios are kept, the more attractive it is to me. However, if I was much later on in my career (like you), I would definitely be singing a different tune.

      Reply

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