015 How to Manage Your Blended Retirement System (BRS) While in Uniform -- 2 of 3

While your service branch may automatically enroll you in the BRS to make Thrift Savings Plan (TSP) minimum contributions of 5% in order for you to get the 5% Match, that's about the only part of it that is automatic. Of course you should contribute more than the minimum -- and beyond that, you'll need to ensure you're investing in the right fund in your TSP. What's more is that you'll need to make slight changes each year, each promotion, and each pay raise to stay on track.

Beyond that, there are other things to manage while you're in uniform that can be easily done with just a little knowledge and the calculator app on your Smart Phone. In this episode we discuss when -- and when NOT -- to make Roth contributions to your TSP; we discuss how you can take advantage of deployments to tax-free areas around the world to do "Mega Backdoor Roth Conversions." You'll learn why everyone in uniform will need to learn how to make a Roth Conversion, no matter what, since your 5% Match goes into a Traditional TSP, and can cost you $10,000s in taxes paid later if you don't.

And of course we also talk about how to plan ahead of your 12th year when you are eligible for the Continuation Pay bonus. Failing to plan for either a deployment, home purchase, or tax-deductible investment with your Continuation Pay can cost you anywhere from $1,000 to $10,000 or more in totally avoidable Federal Income Tax on your bonus. Who wants to give away a quarter of their bonus to Uncle Same? No one wants to, and no one should!

If you missed it last week, be sure to go back and listen to Part 1 of our three-part Podcast series on the Blended Retirement System, and then tune in next week for Part 3!

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