Is it possible to grow your TSP to seven figures? Did you know there are over 113,000 TSP investors in the TSP millionaire club? One of the accounts is worth $11 million. Is it possible to become a TSP millionaire as a career government employee?
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How to Become a TSP Millionaire as a Government Employee or Military
For government employees and military personnel, one of the key retirement savings options available to them is the Thrift Savings Plan (TSP). The TSP is a defined contribution retirement savings plan that offers tax advantages and a wide range of investment options. While it may seem like a lofty goal, becoming a TSP millionaire is attainable with proper financial planning and discipline. Here are some strategies to help you achieve this milestone:
1. Start Early and Contribute Consistently: Time can be your greatest asset when it comes to building wealth. Begin contributing to your TSP as soon as possible to take advantage of compounding returns. Aim to contribute the maximum allowable amount each year to maximize your savings potential.
2. Take Advantage of Employer Matching: If you are eligible for employer matching contributions, make sure to contribute at least enough to receive the full matching amount. This is essentially free money that can significantly boost your savings over time.
3. Diversify Your Investments: The TSP offers various investment funds with different risk profiles. Avoid putting all your eggs in one basket by diversifying your investments across different asset classes. A balanced approach will help mitigate risk and ensure steady growth.
4. Reassess Your Contributions Regularly: As your salary increases or your financial situation changes, review your contribution levels to ensure they align with your goals. Increasing your contributions whenever possible will help accelerate your journey towards TSP millionaire status.
5. Make Intelligent Investment Choices: Educate yourself about the different investment options available in the TSP and choose funds that align with your risk tolerance and long-term objectives. While higher-risk funds may offer more potential for growth, conservative options provide stability during market downturns.
6. Avoid TSP Loan or Early Withdrawals: While the TSP allows for loans and withdrawals under certain circumstances, it is advisable to avoid tapping into your retirement savings before retirement. Early withdrawals can significantly hinder your progress towards becoming a TSP millionaire, as you are not only losing out on potential returns but also incurring penalties and taxes.
7. Seek Professional Advice: Consider consulting with a financial advisor who specializes in retirement planning. They can help you develop a personalized strategy based on your unique circumstances and factors such as your age, income, and risk tolerance.
8. Stay Informed and Monitor Your Account: Keep abreast of any TSP policy changes or updates that may impact your investments. Regularly review your account to assess its performance and make any necessary adjustments to stay on track towards your TSP millionaire goal.
Becoming a TSP millionaire requires commitment, discipline, and a long-term perspective. By starting early, contributing consistently, diversifying your investments, and making informed decisions, you can position yourself for financial success in retirement. Remember, the key is to stay focused on your goals and make any necessary adjustments along the way.
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Awesome, thank you so much!
I thought it was $6,000 for Roth and $20,500 for Traditional… you're putting $20,500 POST TAX funds into your TSP?
I got 80% in c and 20% s!
Is it correct that government Matches 5% only under the traditional TSP (not ROTH)?
ROTH IRA is same as ROTH TSP? Or
Hello! Thanks for your content! AD military members don’t qualify for HSA, correct?
Is that spreadsheet avaiable?
Great info! Thank you! I’ve been in the military for a little under 3 years now. Been staying in C fund with about 20-30% of investments, rest going into G fund.
Should I invest more? Especially with going into the new year? Most if not all funds have had a negative return and I’m still learning as I go! Thank you!
"Government employees are underpaid compared to private sector equivalents."
I'm a government employee myself, and I'll tell you, a lot of my coworkers are OVERPAID compared to the work I see from them.
Happy to be a TSP Millionaire, listened to my mom and dollar cost averaged 100% C S and I (mostly C) fund until last year now getting close to retirement and going to move about 30% total( already have 20% in there) to G fund. Will let the rest sit and keep growning. We maxed out our investments for 20 years.
Question for anyone that can help – my spouse age 38 has 225k in TSP all C fund from 15 years of government service. She may be calling it a career to be a stay at home mom. Is it realistic to think that amount may grow to 1 million in 16-17 years?
I was thinking an average 9 percent rate of return and if she hits that number earlier move everything to G fund and be done with the stock market. Spoke with a financial advisor who told me that this was unrealistic. Thoughts?
Great video and explanation but to address one thing, starting out you will not get the 5% employee match until you hit your 2 year mark but you can still put money in the TSP, you just wouldn’t get that extra 5% .
I’m new to the whole TSP & I need guidance/advice to set myself up for 2050.. So far I have L, G, & F fund..
When the markets are down, your TSP is losing value but it’s not losing money. So, when the market is down, as it is now, there is only one thing to do: BUY! Buy when prices (markets) are down. So when the markets go back up, the value of your portfolio will increase dramatically. That’s how you get to $1M.
What happens in 2022 when your TSP averages a -30% ?
Thanks for sharing! I’d love to hear from the TSP person that has 11 million in their account.
But stocks are down how can you invest in I, C, and S funds? You would be losing all the money
Is Roth tsp better than traditional tsp at the age of 32?
Great honest information! I am proud of you my brother.
Thanks for sharing. Where did you find the information about number of TSP millionaires? Also, where did you find the Excel spreadsheet on TSP?
I'm currently serving I'm happy I've started my tsp my first 2 yrs in my military career and I have 100% invested have 6 yrs of service and now trying to figure out where else should I send the TSP to grow it before I'm 45 or 40
Would you recommend doing 100% Roth in a high tax state like CA? GS 13 with OT… I definitely don’t plan to stay in ca much longer nor in retirement
Very good video
Nice video; reallyed like the background music. I've been in the military for 12 years but just start contributing to my TSP last year cause I didn't really understand finances glad you have these resources out there for folks like me, who dont know any better.