what is the difference between a roth ira and tsp
As retirement accounts, the Roth IRA and the TSP Roth have annual investment limits. The TSP Roth has a significantly higher investment limit than the Roth IRA. Investors will be able to put $16,500 in a TSP Roth, whereas a maximum of $5,000 can be put into a Roth IRA in 2011. A TSP Roth has a higher catch-up provision as well.
When a Roth IRA May Be Better Than TSP. Like a 401k retirement plan, the federal Thrift Savings Plan requires you to pay taxes on both your contributions and earnings that you withdrawal during retirement. While a Roth IRA allows investors to withdrawal their contributions and earnings in retirement tax-free after they reach 59 Â½ years of age.