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Thread: Maxxing out Contributions outside TSP

  1. #1

    Join Date
    Oct 2010
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    Rocket City
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    Default Maxxing out Contributions outside TSP

    Good Morning All,
    New to this side of the board...I have a question on maxxing out contributions.

    I am 50 yrs old
    I am currently maxxed out in my TSP account (plus catch-up)
    I have a Rollover IRA with Fidelity that I am not contributing too
    My MAGI looks to be too high to get deductions for a traditional IRA

    Based on the above, it looks like the best course of action is to open a Roth IRA
    Based on reading posts on this board, it looks like opening an external one is the better choice. (Fidelity??)
    I really wanted to contribute the extra to my Rollover Account so I would only have to manipulate one and not two....
    I also am not sure if I can co-mingle funds in my rollover account (current pre tax money plus adding post tax money)

    Any ideas????

    thx
    Bama


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  3. #2

    Default Re: Maxxing out Contributions outside TSP

    Quote Originally Posted by bamafamily View Post
    Any ideas????

    thx
    Bama
    don't get married...
    100g

  4.  
  5. #3

    Join Date
    Oct 2010
    Location
    Rocket City
    Posts
    246

    Default Re: Maxxing out Contributions outside TSP

    Quote Originally Posted by burrocrat View Post
    don't get married...
    Too late....lol

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  7. #4

    Join Date
    Dec 2007
    Location
    inland Northwest
    Posts
    4,124

    Default Re: Maxxing out Contributions outside TSP

    Hi Bama, I'm thinking you can comingle nondeductible (post-taxed) contribs in your rollover IRA, it just gets complicated on withdrawals later. I have a longtime small trad IRA that was mostly deductible, but then I put some non-deductible funds into it later, before I quit contributing to outside IRA entirely and started putting everything into TSP. I moved some of the commingled trad IRA out into starter conversion Roth back around 2002, had to figure out the deductible vs. nondeductible ratio and pay taxes on the deductible portion, to establish the conversion Roth account. and will have to do the same every time I pull any out of the trad IRA that still exists, until it's fully depleted.

    You might have to keep track of 2 accounts (Roth and Rollover), but it could still be simpler than having commingled, when it comes to withdrawals from single commingled account later.
    "life can only be understood backwards, but it must be lived forwards" - soren kierkegaard

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