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Author: FlippoHip Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75335  
Subject: IRA question Date: 6/4/2005 6:36 AM
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I have a TSP (which is a government 401K) plan that I contributed to for a few years. I separated from the military, so I cannot make contributions to it anymore, and want to roll it into an IRA. (I could just leave it and let it grow, but I'd rather put it into something I can work with)

I am opening a traditional IRA through my bank (because that's the only thing I can roll my TSP into) and my investment options are confusing.

I have my choice of a fix-rate CD, a variable rate CD or a money market account. I thought IRA's were put into stocks and funds.

What gives?

Also, how can I make monthly contributions into a 36 month CD?? It doesn't make any sense.
Yes, I have a disclosure statement, but it seems to assume I already know what I'm doing.

I went to the Fool IRA section, but it was just ads for brokers.

Can anyone clue me in? I'd appreciate it.
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Author: TwoCybers Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 46327 of 75335
Subject: Re: IRA question Date: 6/4/2005 8:44 AM
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Two possibilities I can see

#1 You bank may be limiting your options to what they have or want to sell.

#2 The TSP may have limitations. I have a small pension from a University and my only options on that are an annuity for my life and another annuity that would give my wife some income.

I suggest you give a call to a full line broker such as Charles Schwab. They will certainly know what a TSP plan is and they certainly will have options for equities, bonds, indexes, etc. (You may well want to move the TSP to another company then Schwab -- I am suggesting them based on my experience to get factual, clear answers to your questions.)

Gordon
Atlanta


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Author: alstroemeria Big gold star, 5000 posts Top Recommended Fools Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 46328 of 75335
Subject: Re: IRA question Date: 6/4/2005 9:59 AM
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I don't know anything about restrictions on where you can roll over your TSP account (maybe you need to roll it over to a bank-based IRA and can then roll it over agian to a brokerage??), but I would reconsider moving investments from TSP--they have rock-bottom expenses and fabulous index funds. Even my DH's 403(b) with TIAA-CREF doesn't quite compare.

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Author: joelxwil Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 46330 of 75335
Subject: Re: IRA question Date: 6/4/2005 10:08 AM
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If you open an IRA with a broker, you have many more possibilities than elsewhere. I have my IRA with Ameritrade. Avoid E-Trade and Brown because of their strange enforcement of Regulation T (see previous posts).

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Author: jrr7 Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 46331 of 75335
Subject: Re: IRA question Date: 6/4/2005 10:17 AM
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Are you *required* to roll over your TSP? I'm pretty sure that you can still adjust your mix of the 5 or so funds in it even though you're not part of the military. I'd echo the opinion of the other poster that you're not going to find better funds available than the ones in the TSP. I'd recommend using the TSP as the base of your portfolio -- it's diversified and so should give you some stability.

Anyway, you can start an IRA with any IRA custodian, but when you do you can only invest in items that that custodian allows. If you open an IRA at a bank, you can only invest in bank products. If you open an IRA at a mutual fund company, you can only invest in that company's mutual funds. If you open an IRA at a broker, you can invest in just about anything.

> 36 month CD
The bank hopes that each year you'll contribute $4000 and put it into a new 36 month CD.

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Author: wcfenton Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 46337 of 75335
Subject: Re: IRA question Date: 6/4/2005 4:11 PM
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I have a TSP (which is a government 401K) plan that I contributed to for a few years. I separated from the military, so I cannot make contributions to it anymore, and want to roll it into an IRA. (I could just leave it and let it grow, but I'd rather put it into something I can work with)

I am opening a traditional IRA through my bank (because that's the only thing I can roll my TSP into) and my investment options are confusing.

I have my choice of a fix-rate CD, a variable rate CD or a money market account. I thought IRA's were put into stocks and funds.

What gives?

Also, how can I make monthly contributions into a 36 month CD?? It doesn't make any sense.
Yes, I have a disclosure statement, but it seems to assume I already know what I'm doing.

I went to the Fool IRA section, but it was just ads for brokers.

Can anyone clue me in? I'd appreciate it.

-----------------------

To the best of my knowledge, a TSP Account has most of the benefits and must follow the same rules associated with 401k plans. That would include rollovers to your new employer's 401k plan or to a Traditional IRA if that is what you elect to do. Take a look at the following TSP Online Booklet for answers to your questions. There are phone numbers included for additional questions:

http://www.tsp.gov/uniserv/forms/tspbk02.pdf

Your rollover from the TSP to a Traditional IRA isn't limited to your bank. Personally, I think that you would be much better off, as you are finding out, going through one of the better fund companies like Vanguard:

https://flagship3.vanguard.com/VGApp/hnw/content/AccountServ/Retirement/ATSRollOverPlanContent.jsp

Regards,
Bill



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