Max contribution

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tyler3535
Posts: 109
Joined: Thu Jan 12, 2017 2:50 am

Max contribution

Post by tyler3535 »

So I know the most you can contribute to TSP is 18k annually. Does that include the government match? If I contributed 18k, would that be too much because the gov is matching 5% as well? Or is the 5% not included in the 18k? And what happens if you over contribute?

Thanks!!!

mmmmmbeer
Posts: 917
Joined: Wed May 11, 2016 11:00 am

Re: Max contribution

Post by mmmmmbeer »

Howdy.. actually it's 18,500 as of 2018 and nope that doesn't include the match. So for instance I max out 18,500k the gov matches an additional 7500.. I'm actually putting in an additional 26k a year! Woo hoo!
Those who 'abjure' violence can do so only because others are committing violence on their behalf.

Bologna13
Posts: 20
Joined: Mon Dec 12, 2016 9:55 pm

Re: Max contribution

Post by Bologna13 »

make sure you don't hit the max before the last pay period of the year and lose any of your matching money. They will stop deducting from your check as soon as you hit that threshhold

floridabre
Posts: 24
Joined: Thu Sep 11, 2014 7:48 am

Re: Max contribution

Post by floridabre »

and dont forget the over 50 "catch up" of 6000...

Cpt. Pile
Posts: 11
Joined: Mon Mar 11, 2013 7:55 pm

Re: Max contribution

Post by Cpt. Pile »

mmmmmbeer wrote:Howdy.. actually it's 18,500 as of 2018 and nope that doesn't include the match. So for instance I max out 18,500k the gov matches an additional 7500.. I'm actually putting in an additional 26k a year! Woo hoo!

mmmmmbeer, how is the $7,500 calculated? I know the gov will match up to 5% of your contributions, but never thought about how much that is. Does that come out to $7,500 for everyone doing the max $18,500 yearly contributions or is the 5% related to base salary at all?

Cpt. Pile
Posts: 11
Joined: Mon Mar 11, 2013 7:55 pm

Re: Max contribution

Post by Cpt. Pile »

Cpt. Pile wrote:
mmmmmbeer wrote:Howdy.. actually it's 18,500 as of 2018 and nope that doesn't include the match. So for instance I max out 18,500k the gov matches an additional 7500.. I'm actually putting in an additional 26k a year! Woo hoo!

mmmmmbeer, how is the $7,500 calculated? I know the gov will match up to 5% of your contributions, but never thought about how much that is. Does that come out to $7,500 for everyone doing the max $18,500 yearly contributions or is the 5% related to base salary at all?
I just figured out my own question, nvmd. It's based off of salary for anyone else wondering. I've never realized that though, but I guess every time you get a pay raise, you're also getting a bump in gov match towards tsp, which is sweet! :D

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mattch45
Posts: 68
Joined: Sat Nov 21, 2015 3:01 pm

Re: Max contribution

Post by mattch45 »

Bologna13 wrote:make sure you don't hit the max before the last pay period of the year and lose any of your matching money. They will stop deducting from your check as soon as you hit that threshhold
This... but also don't forget you can still partially front-load the year. Subtract your minimum contribution to get the full match through the entire year (don't forget any predictable pay increases!) from $18,500, and that's the amount you can contribute ASAP for maximum benefit.

Neuronic
Posts: 68
Joined: Sat Dec 10, 2016 9:33 pm

Re: Max contribution

Post by Neuronic »

Also, if you are fortunate/disciplined enough to contribute $18,500, consider if you can can do that with Post-tax (Roth) money. Specifically, that would be worth more than $18,500 in traditional contributions as earnings on your max contribution would not be taxed.

mmmmmbeer
Posts: 917
Joined: Wed May 11, 2016 11:00 am

Re: Max contribution

Post by mmmmmbeer »

Neuronic wrote:Also, if you are fortunate/disciplined enough to contribute $18,500, consider if you can can do that with Post-tax (Roth) money. Specifically, that would be worth more than $18,500 in traditional contributions as earnings on your max contribution would not be taxed.

Who has thumbs and is doing this?? THIS GUYYYYY!
Those who 'abjure' violence can do so only because others are committing violence on their behalf.

mindofmush
Posts: 353
Joined: Mon Jul 02, 2012 1:38 pm

Re: Max contribution

Post by mindofmush »

And you can add $5500 ($6500 over 50) to a Traditional or Roth IRA account for yourself and another for your spouse (if you have one of those) too.
mo meng, mo ching (which loosely means: no money, no life)

smcwhorter
Posts: 9
Joined: Mon May 09, 2016 8:25 pm

Re: Max contribution

Post by smcwhorter »

Just so I'm completely clear:
Max an (unmarried) individual can contribute to an IRA = $18,500 ($5,500 can be Roth, but that comes out of the total so only $12,000 could be put in traditional in this case)
Max an individual can have go towards an IRA (including matching) = $55,000 (so gov't matching COULD be as much as $36,500. The only way to reach $55,000/year is by employer contributions)
These max numbers are doubled for married individuals.
Is this everyone else's understanding?

mmmmmbeer
Posts: 917
Joined: Wed May 11, 2016 11:00 am

Re: Max contribution

Post by mmmmmbeer »

smcwhorter wrote:Just so I'm completely clear:
Max an (unmarried) individual can contribute to an IRA = $18,500 ($5,500 can be Roth, but that comes out of the total so only $12,000 could be put in traditional in this case)
Max an individual can have go towards an IRA (including matching) = $55,000 (so gov't matching COULD be as much as $36,500. The only way to reach $55,000/year is by employer contributions)
These max numbers are doubled for married individuals.
Is this everyone else's understanding?

Uhh.. no. Max TSP is 18,5k.. all.can be roth max roth IRA is 5,500
Those who 'abjure' violence can do so only because others are committing violence on their behalf.

raymonster
Posts: 17
Joined: Wed Aug 09, 2017 2:09 am

Re: Max contribution

Post by raymonster »

smcwhorter wrote:Just so I'm completely clear:
Max an (unmarried) individual can contribute to an IRA = $18,500 ($5,500 can be Roth, but that comes out of the total so only $12,000 could be put in traditional in this case)
Max an individual can have go towards an IRA (including matching) = $55,000 (so gov't matching COULD be as much as $36,500. The only way to reach $55,000/year is by employer contributions)
These max numbers are doubled for married individuals.
Is this everyone else's understanding?
IRS Announces 2018 Pension Plan Limitations; 401(k) Contribution Limit Increases to $18,500 for 2018

https://www.irs.gov/newsroom/irs-announ ... 0-for-2018
Curr:100 SFund 15Aug2018DWCPF
Prev:100 CFund 14Aug2018
38878

08/31/18 PIP 7.46%
07/31/18 PIP 4.99%
06/30/18 PIP 2.7%
05/31/18 PIP 3.94%
04/30/18 PIP 4.52%
03/31/18 PIP 3.09%
02/28/18 PIP 7.93%
01/31/18 PIP 13.49%
12/31/17 PIP 16.0%
11/30/17 PIP 15.6%
10/31/17 PIP 15.62%
09/30/17 PIP 13.03%
08/31/17 PIP 11.89%

mindofmush
Posts: 353
Joined: Mon Jul 02, 2012 1:38 pm

Re: Max contribution

Post by mindofmush »

smcwhorter wrote:Just so I'm completely clear:
Max an (unmarried) individual can contribute to an IRA = $18,500 ($5,500 can be Roth, but that comes out of the total so only $12,000 could be put in traditional in this case)
Max an individual can have go towards an IRA (including matching) = $55,000 (so gov't matching COULD be as much as $36,500. The only way to reach $55,000/year is by employer contributions)
These max numbers are doubled for married individuals.
Is this everyone else's understanding?
The IRS $55,000 max limit applies to "defined contribution retirement plan" not the TSP (which is the same as a 401k). (IRS Pub 560)

Max (unmarried) individual contribution to an IRA = $5500 (for under age 50) $6500 (for age 50 and over)
The IRA can be either Roth or Traditional, same contribution limits. (IRS Pub 590a)

Your maximum contribution to your TSP account for 2018 is $18,500, the government match of 5% isn't part of the $18,500 limit. If over 50 years old, the IRS allows you to contribute an additional $6000 to your TSP account on top of the $18,500 limit.

For more clarification (or confusion) go to the IRS.gov website to read or download the IRS Publications #560, #590a, and any others that interest you.
mo meng, mo ching (which loosely means: no money, no life)

User avatar
evilanne
Posts: 2067
Joined: Thu May 14, 2015 6:52 pm

Re: Max contribution

Post by evilanne »

mindofmuch is correct, however, the outside Roth is subject to income limitation. If you are above that limitation, there is the backdoor Roth IRA option.

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