Why TSP Is The Way To Go

By David Chan

Thrift Savings Plan aka TSP, is similar to a 401(k) but one that the government provides to all the federal employees. The TSP plan is a perfect fit for people who want to save but don’t like the hassle other ordinary savings plans possess. Let’s take a look at why exactly it is what you might be in need of:

The Quick Breakdown

Diversification:

TSP has a diverse choice of funds. Through it, you can get your hands on government bonds, various indexes and even the S&P 500.

Low Fees:

Many of the funds have a low cost attributed to them and have become a great choice over many other funds in the marketplace. However, there’s also room for alternative options.

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Roth option for IRA:

In 2012, the Roth feature was added for TSP accounts. Roth TSPs are a great option when considering your entire investment strategy. There are options for tax-free withdrawals and after tax investments. Of course, always consult with a professional first before you take any withdrawals.

Summary

The TSP is a great retirement vehicle. It is one of the most popular investment programs you have available as a federal employee. Of course, don’t discount the help and advice of a professional you can trust. Whether it is to ask questions about your investment options or if you are now preparing to retire, a planning professional who knows and understands your options are vital.