Hi all--assessing my portfolio and trying to see where to direct my excess savings, especially once I'm done paying my student loans this year.
I'm wondering if I should be increasing my TSP contribution or increasing my taxable investing for tax diversification and flexibility. I am maxing out my Roth IRA contributions, and contributing more to TSP than the minimum for full employer match.
When I added up all of my contributions, in 2023 I contributed almost 15% of my total income to various retirement savings vehicles between TSP (2% Traditional, 7% Roth) and Roth IRA (5.5%) plus received the 5% TSP match. On top of that I am contributing to my pension. Meanwhile my auto-investment into my brokerage account is only 3%.
I'm eligible to retire at 50 (which is 13 years away) but am planning to retire around age 60. I know that I'll need my money to stretch for a long time if I don't decide to take paid work after I retire, especially if I live as long as some members of my family (into their 90s). However, I'm concerned that if I put more into TSP then I'll have less flexibility in my funds, especially before age 59. My main goal for my retirement funds is to save enough so I don't run out of money at end of life.
My other complicating factor when determining what to do next with my investing money is the pension. My pension will provide 37% of my high-3 salary retiring at 50 (47% if I retire at 60) and I'll still receive social security, so my retirement investments should only need to cover 25% of my pre-retirement salary if I'm aiming for 75% replacement.
How do you determine when you should start shifting your contributions towards taxable over retirement vehicles? If you were me, would you put into taxable or TSP?
I've included my portfolio info below. I keep it simple and index-based.
Emergency funds: Yes (6 months)
Debt:
Student loan--currently on income-based repayment plan (SAVE), PSLF forgiveness projected 11/2024
Mortgage--$360,000 at 5.25% 30-year loan (29 years left), split equally with my partner
Tax Status: Single, no children
Tax Rate:
Federal 24% tax bracket, State 5.5% tax bracket
State: VA
Age: 37
Desired Asset Allocation: 85% stocks/15% bonds, 40% international/60% domestic for stocks
Total portfolio: about $330k including cash, not including emergency fund
Current assets:
Taxable:
4.5% cash
3.5% VTSAX
2.2% VTIAX
TSP (62% total portfolio):
8.1% G Fund
5.7% F Fund
18.7% C Fund
9.5% S Fund
20.4% I Fund
Roth IRA (27% total portfolio):
10.4% VTIAX
16.4% VTSAX
I'm wondering if I should be increasing my TSP contribution or increasing my taxable investing for tax diversification and flexibility. I am maxing out my Roth IRA contributions, and contributing more to TSP than the minimum for full employer match.
When I added up all of my contributions, in 2023 I contributed almost 15% of my total income to various retirement savings vehicles between TSP (2% Traditional, 7% Roth) and Roth IRA (5.5%) plus received the 5% TSP match. On top of that I am contributing to my pension. Meanwhile my auto-investment into my brokerage account is only 3%.
I'm eligible to retire at 50 (which is 13 years away) but am planning to retire around age 60. I know that I'll need my money to stretch for a long time if I don't decide to take paid work after I retire, especially if I live as long as some members of my family (into their 90s). However, I'm concerned that if I put more into TSP then I'll have less flexibility in my funds, especially before age 59. My main goal for my retirement funds is to save enough so I don't run out of money at end of life.
My other complicating factor when determining what to do next with my investing money is the pension. My pension will provide 37% of my high-3 salary retiring at 50 (47% if I retire at 60) and I'll still receive social security, so my retirement investments should only need to cover 25% of my pre-retirement salary if I'm aiming for 75% replacement.
How do you determine when you should start shifting your contributions towards taxable over retirement vehicles? If you were me, would you put into taxable or TSP?
I've included my portfolio info below. I keep it simple and index-based.
Emergency funds: Yes (6 months)
Debt:
Student loan--currently on income-based repayment plan (SAVE), PSLF forgiveness projected 11/2024
Mortgage--$360,000 at 5.25% 30-year loan (29 years left), split equally with my partner
Tax Status: Single, no children
Tax Rate:
Federal 24% tax bracket, State 5.5% tax bracket
State: VA
Age: 37
Desired Asset Allocation: 85% stocks/15% bonds, 40% international/60% domestic for stocks
Total portfolio: about $330k including cash, not including emergency fund
Current assets:
Taxable:
4.5% cash
3.5% VTSAX
2.2% VTIAX
TSP (62% total portfolio):
8.1% G Fund
5.7% F Fund
18.7% C Fund
9.5% S Fund
20.4% I Fund
Roth IRA (27% total portfolio):
10.4% VTIAX
16.4% VTSAX
Statistics: Posted by OregonGal — Wed Jan 03, 2024 1:40 pm — Replies 1 — Views 184