“Use that to help guide your choices for working on your goals. “The most important thing is sometimes the hardest thing to do, and that is to step back, take a deep breath, and look rationally at what you have and what your balance sheet looks like for your family,” said Walsh. Many people wonder, in this time of stock market craziness, whether they should take some action with their investments. “Start small and dream big, because as those contributions accumulate and compound and are matched, there are opportunities for growth.” Dealing with volatility “One of the best ways to save for retirement is saving over a long time, and to continue, even if you start small,” said Gerri Walsh, president of the FINRA Investor Education Foundation. “I made sure during my entire career that I paid myself first, making that TSP contribution first, before anything else.” “If service members can get those big bonuses into their TSP right off the bat, they’re just setting themselves up for success,” he said. He’s gotten two reenlistment bonuses, and was able to put most of those into his TSP. He also contributed as much of special pays and incentive pays that he could within the IRS limits. So, I always made sure that I upped everything before my pay raise took effect, because once you get that money in your pocket, you don’t want to give it back.” “Ultimately the goal was to get as much in as I could, but to never feel it. And when he got promoted, before the pay raise showed up in his paycheck, he bumped up his contribution by that amount. “I’m a big proponent of the TSP, to the point where the crew hates standing watch with me because they get four hours of TSP talk, whether they want it or not,” he said.Įach year in December, he increased his TSP contribution by whatever the pay raise was for the following calendar year. Steve has long encouraged other service members to start investing early in their TSP. Source: Federal Retirement Thrift Investment Board Troops contributing at least 5% to get the full TSP match 1, 2018, are automatically enrolled in BRS, as well as certain others who converted to BRS from the legacy retirement system before the 2018 deadline. All those coming into the military as of Jan. That means those contributing at least 5% of basic pay are, in essence, contributing 10% to their retirement. The TSP landscape changed with the military’s Blended Retirement System, or BRS, in which DoD now matches up to 5% of TSP contributions. In addition to his TSP, Steve has about $200,000 in an IRA account, which he used to begin saving in 1995, before TSP became available. You buy more shares of stocks with that $100 when the price is low and fewer shares when the stock price is high.īut there are likely others who are millionaires because they’ve been piling up savings and investments outside the TSP, too. “Dollar-cost averaging will be the winner in the long run, or at least it has been for me,” he said.ĭollar-cost averaging means putting money into the investments on a regular basis over time, as you do with the TSP, the government’s equivalent of a 401k retirement plan.
0 Comments
Leave a Reply. |
Details
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |