Say you are hypothetically someone who has roughly 300k in your tsp.. and say 7-ish years to go until you hit minimum retirement of 50 years old and have at least 20+ years of covered service. (your own numbers and years left into this for your scenerio)
With the new TSP rule coming into place in less than 2 years that will allow you upon retirement to stipulate which TSP balance to draw from, it makes a lot of sense to now go 100% Roth TSP contributions if you can.
In this hypothetical scenerio... in 7 years @ 12% RoR, the subjects TSP Account is roughly valued at $930,000 ($718,000 traditional /$212,000 Roth).
At that point you are 50, can retire and elect to draw specificially/only from your traditional tsp balance of $718k.
You allow your Roth balance to grow an additional 9.5 years, unfettered @ (hopefully) 12% a year giving you a nice untaxable balance of $588,000 @ 59.5 years old.
Additionally say @ 50 you want to retire and start drawing $6,000 a month from your traditional balance of $718k. Well if you can maintain that 12% RoR, your balance (even with zero new monies going in and the 6k/month draw) will continue to grow and at 59.5 yo when you can dip into your roth unpenalized, your traditional balance will have grown to $870k.
Not to shabby for being retired for 9.5 years, all the while drawing your pension, SS supplement + an additional $72k a year from your tsp balance.
So.. that's the dream for those hypotheticals out there anyway!
Young and old LEOs, Firefighters, ATC's run your scenerios... if you have a decent traditional balance already and a few years left... maybe think about the 100% Roth option now.
