Dave Ramsey Recently gave this advice regarding a TSP investors questions on the TSP versus the IRA:
“I’d roll it to an IRA outside [of the TSP] – you can do better with open market mutual funds than the Thrift options give you.”
To see the rest of his thoughts visit the link below about the article.
To watch my previous video on Dave Ramsey’s thoughts on the TSP, visit here:
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Good points, thanks for correcting Ramsey's blanket statement.
For me there is no reason to keep my money in the TSP. I pay no fees for my IRA and I can take as much or little money as I want as many times as I want. With a couple of moves on my computer I can have the money electronically transferred to my checking account. In a TSP I need a notary and fill out forms to get access. I'm sure they make the rollover process a nightmare so you leave the money in the TSP but, I believe my patience will be rewarded once it's done.
Should I use my TSP to pay off my mortgage?
In other words, is it wise to do that?
Really Great advice THANKS
I am now 72. WHEN i took a $50k from my TSP they took $10k out of that for taxes(?) Was that correct? Was I in error to think there was a
1- time non-taxed withdrawal?
Also, with the Economy going in the toilet I’m considering transferring to a Gold IRA. Is this wise due to the Failed Government Leadership we are collectively suffering from? Seems a huge CRASH is imminent.
What form do I use to transfer from tsp to Roth IRA
Learn to read
President Brandon has suggested taking the TSP and using it to prop up Social Security. Let's Go Brandon. Of course that is a TERRIBLE idea. This isn't even mentioning the Great Reset.
You will be happy with nothing seems to be their new motto. the Guberment will provide.
Remember what Ronald Reagan said, Government isnt the solution, it's the problem.
If you retire at you MRA you have to keep it in the TSP to be able to access it. The best answer is BOTH. At 62, roll the TSP into an IRA.
Risk tolerance is the same regardless of whether it's inside and outside the TSP. The only real benefit of the TSP (after retirement) is the low cost of overhead. The benefits of moving it out are many. Dave knows that there are funds out there that double the S&P rates of returns (if that's where your invested) with modest overhead costs.
No wonder he can afford all that dam equipment
All these comments are is hate for Dave Ramsey. Why should anyone trust You. When you get your own radio show, write a system, (The Babysteps) have over 6 plus million people become debt free and the start teaching others how to do that, when you stop using credit cards and pay cash for everything for 30 years, then, I might respect your opinion.
I became debt free this year in May 2021, which means I don't get debt bills every month now. I also have 5 month emergency fund saved and I now have a Roth IRA, and for the first time seeing money grow, and I still work, because I'm still breathing.
So rather that putting a video out that encourages people to bash and mock other, have the heart of a teacher as Dave always encourages, seek wise counsel as Dave always says, and never invest in Anything you don't understand.
I hope you've grown up more as a financial advisor, with a humble heart.
Good info at the time, but withdrawal rules from the TSP have changed now, becoming much more flexible. Ignore this and look for TSP information from September 2019 on before making any decisions. That’s when the TSP Modernization Act went into effect. The CARES act could affect some TSP participants, too.
But if you take money out of your tsp…it’s called a loan that you need to pay back. On top of that…40% interest if your not retired
Never have Ramsey as your only source. He’s a bit arrogant in the sense he likes to put out blanket, quick, answers that require a lot more thought.
tsp rollover ira only retire 1 month after we can do
Excellent analysis.
I would move to outside for options only because I'm financially savvy. I would not pay 12b1 fees or management fees. I would buy aristocrat dividend stocks.
Is it possible to move a traditional TSP (tax deferred) to a Vanguard/Fidelity brokerage account in the hopes of then investing in a dividend paying stock? tax implications?
I think the real deal in this conversation is how savvy are you with investing. If not at all, maybe staying with the TSP is good. I just moved right at 1M to a Vanguard IRA. The issue is it goes into a settlement account, do you want to just dump this into stock funds at historic highs with potential barriers on the horizon like inflation etc… all at once? Scary stuff. I'm fairly conservative. Will probably trickle it in on 1% drops into high dividend yield high quality type funds. Give me a 20% correction, I'd be big in with the rest.
This this an old video so things have changed. I am in the process of moving my TSP to Vanguard. During the Pandemeic, me being somewhat conservative left some on the table. I saw what was coming and pulled out of stocks just in time and didn't lose anything but missed out on the upside. The real problem as a retiree especially is that you have to make a decision before noon regarding the the market at the end of the day which was scary last year. Had my money been in an IRA Vanguard/Fidelity etc… this could have been a real world scenario limiting risk. As a young employee let it ride. Additionally you can purchase stocks without costs. ETFs have low costs similar to TSP.
This video is outdated; please go to TSP4gov to get the most recent changes, including maintenance fees (0.39c/0.40c per thousand), installment options, etc.
I get a 5% match on my TSP from my employer. I'm giving not away free money. Also, a 10% penalty for withdrawing from TSP before age 59 1/2. That would be a terrible move.
I just recently retired from Federal Government and still have my TSP account. I am totally into real estate investing and currently have three properties. I make good passive income with those properties but I want to buy more. I know TSP does not allow me to use the funds for a 1031 exchange. So this is my main reason that I want to roll over to any 401k product, so I can use the 1031 exchange. Do you have any recommendations on which product will be the best for this? Thank you!
Dave gave best, concise answer for most people, IF you do the research. That research could be very time consuming.
TSP's greatest advantage is invested makes one decision one time, and forget about it until later, or even until retired.
Convenience.
It costs opportunity loss, but prevents loss due to indecision, ignorance or procrastination.
This past year was booming for the stock market. How then am I getting a negative return on my TSP? All of the funds are doing terrible. Get out of the TSP
But does Dave Ramsey even lift? Has he made the best investment, a home Gym!!
Might want to update this video. The withdrawal options have changed.
COOOOOOOOOP!
Ramsey also bases his financial advice on religious doctrine. He is against anyone utilizing bankruptcy as a financial strategy, because biblically you should pay off your debts. Funny, since he has used bankruptcy in the past, and there should be no difference in personal and business debt, which is what he has had. Makes no sense to not take advantage of all avenues and tax laws.
In case you haven't noticed, the money you keep in TSP is actually managed by yourself. Blackrock is just a custodian. They do nothing but accounting your money and reporting. They make no decisions on where your money is invested in; except those L Funds which the management process is minimal. I don't put my money in any of the L Funds. Only mostly C, S, somtimes I funds. Having said that, an identical approach to TSP is an IRA account self-managed at TD Ameritrade has NO fees unless you let them actively manage it. So, there you have it. You can let your IRA account idle like sitting in the G Fund, or invest in SPY (your C fund), or Willshire 4500 (your S fund), or EFA (your I fund). I personally would just keep my money into the SPY, QQQ, and DIA, and let it run just like TSP. And have full access to it when bad news happen. And you can do things like selling covered calls and puts all week long; something TSP will not allow you to do.
Back to the benefits of keeping money in TSP, please give us better reasons.
If you leave the TSP you lose employer matching funds…..you're not getting free money. Just another thing to consider.
When you are investing in aggresive growth funds such as C, S, and I and the market tanks, you are in the same damn boat just like anyone else. This is a very very bad argument about staying in TSP. On the other hand, in an IRA, you can still put your money into the indices identical to C fund, S fund, and I fund if you want. Exposure to the market volatility is exactly the same. YET, with an IRA, you are not limited to 2 trades a month and trades become effective on the fly. Not at the end of the day. I am not encouraging you to become a day trader with an IRA account. But the freedom does allow you to respond to an adverse market condition that TSP ties your hands behind your back.
Ok, i am lost you say max out your TsP but then say, to move your tsp to a roth ira. please explain.
So I'm 21 about to get out of the military I have almost ten grand in the tap 50% c and 50% s fund I'm not sure if I should just leave it there and let it grow and start a new retirement or roll it over ant advice?
Can I continue investing into my TSP if I leave the military?
Dave Ramsey is a Moron that forces his religion on people.
I left federal service before and rolled over the TSP funds into an IRA. Then I later converted the IRA into a Roth IRA so the funds would grow tax-free until retirement. I would recommend that people plan for how much tax they are going to have to pay in the year they convert from a traditional IRA into a Roth IRA because that can be a large amount of money to have to pay.
Dave Ramseys net worth is $55000000. If all his money Is in the large caps and the SnP goes down 90% he will still is be a multi millionaire. As far as investing, he is out of touch with us common folk. Though it is a good idea to get and stay out of dept, the common government worker needs a solid base like a portion in the G fund to cover basic needs in case the market free falls. Sorry Dave, not a hater just a realistic thinker. 20% base in G, 5% in f, 15% in s, 5% in I, 55% in c fund.
Need to get Coop’s channel monetized so he can make more videos down the line and make all his efforts for us worth it. Anyone watching this hit like and subscribe please.
I was actually wondering the opposite, if I should roll my USAA Roth IRA into the ROTH TSP. I already have a Traditonal TSP just only looking to add the match of 5% to it, hence the need for the ROTH.
Can we please stop listing access to your retirement funds, when you are not in retirement, as a plus? It is a retirement account. It's supposed to be used for retirement. You should have money to pay for your roof and other emergencies. Also, you could do a tsp loan at ridiculously low interest rates to pay for the roof as well. You pay yourself back, not the bank, and you don't kill your retirement.
That being said, the TSP is good place to start. You can definitely get better returns in other places. You have to know your stuff. I personally believe that too many choices leave people immobilized. Analysis paralysis. I do it all. traditional and Roth tsp, Roth IRA, non tax advantaged brokerage account.