Supplement Your Retirement by Setting it On Autopilot Today

By Alecia D. Blair, Military Saves Communications Associate

Let’s face it. A military pension and social security will likely not be enough to sustain a comfortable standard of living during retirement. So, enhance your retirement savings for tomorrow by enrolling and saving automatically in the Thrift Savings Plan (TSP), an Individual Retirement Account (IRA) or other employer-sponsored retirement plan today.

Thrift Savings Plan (TSP)
The Thrift Savings Plan is a government-sponsored retirement savings plan for military service members and federal civilian employees. Established by Congress in 1986 as part of the Federal Employees’ Retirement System Act, the TSP offers many savings and tax benefits worth exploring.

Depending on whether you choose the Traditional TSP or the Roth TSP, contributions are tax deferred or are tax free when withdrawn under specific circumstances, according to Military OneSource.

Moving on after the military? You can take the TSP with you wherever life takes you. Whether you separate early from the military or earn a military retirement after 20 years, the TSP is yours to keep.

If you are separating from the military, research whether rolling over your TSP is right for you.

To learn how to sign up for the TSP, make a contribution election and access your account after signing up, read “Sign Up and Save with the Thrift Savings Plan.”

Individual Retirement Accounts (IRA)
Another tool to help you supplement your military retirement income and social security is the individual retirement account (IRA)—a savings account that you can set up through your financial institution, advisor or life insurance company. Before doing so, consider the different benefits to the traditional versus Roth IRA.

According to the Internal Revenue Service (IRS), the maximum you can contribute for 2015 for traditional and Roth IRAs is “$5,500 if you’re under age 50.” Learn more about IRAs today and take advantage of this retirement tool.

Employer-Sponsored Retirement Plans
It’s possible (and likely) that you’ll have a second career after retiring or separating from the military. With time on your side, this provides the perfect opportunity to enroll in an employer-sponsored retirement plan at work if one is offered.

The most common forms of employer-sponsored retirement plans are the 401k, and 403b (public schools and certain tax-exempt organizations) and 457b (government employers). Employees make contributions to these accounts from their wages prior to taxation and pay taxes when the money is withdrawn at retirement.

Some employers may even match your contributions, and employees may elect to make contributions automatically from their wages. Take advantage of this opportunity to set your retirement savings on autopilot, and enroll. Learn more about saving at work through these retirement tools, now!

“Set a goal. Make a plan. Save automatically.” Save now, and retire comfortably later on.

 

Tip of the Day

  • Written by Katie Bryan | December 16, 2013

    Check out the guide from @CFPB that helps you to know which questions to ask when shopping for a financial advisor http://ow.ly/rrjYO 

Saver Stories View all »

A Disciplined Approach to Saving

Written by Super User | November 26, 2010

I just recently retired after 30 years of service with the Marine Corps. I truly enjoyed my time serving the Corps and I flourished in the disciplined environment. I also took a disciplined approach to saving. Here are some of the tactics I used-they are very low to moderate risk.

Read more...

Building Wealth by Setting Goals

Written by Super User | April 24, 2013

My name is Allison Mecadon and I’m a Youth Coordinator with the Virginia National Guard Youth Program. My husband, Tom, is an M-Day Army National Guard Member (an M-Day member is one who performs weekend drill, but is not on full-time duty).

Read more...

Money on the Side

Written by Super User | November 26, 2010

Camp Arifjan, Kuwait -- A colonel in the 1st Theater Sustainment Command has money on his mind.

Army Col. George Fields, the Chief of Intelligence, or G2, has been teaching a free "Managing Your Money" class here in his spare time. More than 400 students have attended his six week-long class to learn more about increasing their own finances.

"All I did was sit down and listen to a guy one day who showed me what he was doing" said the colonel as he explained how he became interested in what he calls, "becoming financially free."

Read more...