The Blended Retirement System Opt-In Course is now available! If you are eligible to opt in next year, now is the time to learn more. The course will compare your current plan to the Blended Retirement System and help you make your best decision. https://jkodirect.jten.mil
The Blended Retirement System goes into effect for eligible Service members in 2018, making 2017 the time to learn all about this new option. Take the BRS Opt-In Course today and get the facts you need to make an educated decision. https://jkodirect.jten.mil
Looking for information on the new blended retirement system?
Click on the image below to view a Frequently Asked Questions page created by Military OneSource and a video from the Defense Video Imagery Distribution System.
How your election requirements will change:
An upcoming change in myPay will require you to designate your Roth contributions as a percentage of your pay, not a dollar amount. If you don’t comply with this change, then the Defense Finance and Accounting Service (DFAS) will not be able to process your Roth contributions. This change affects your Roth contributions only; your traditional contributions are already designated as a percentage of pay.
When the change will take place:
The new requirement will take effect January 1, 2015. You will have 30 days to change your Roth election from a dollar amount to a percentage of your pay. If your new Roth election is not received by January 31, 2015, then DFAS will not be able to process your Roth contributions until you update them.
How to make the change:
Log into myPay. You’ll see a special TSP section called “Traditional TSP and Roth TSP”—click there. Then, in the “Contribution from Roth TSP” section, you can enter the percentage of your pay that you’d like to contribute (10%, for example). Finally, click “Save” at the bottom of the screen.
The other way you can make the change is to submit the paper election form, TSP-U-1, available on www.tsp.gov to your finance office.
Effective 1 January 2015, investors will face stricter rules on how they can move their money between individual retirement accounts or IRAs by limiting them to just one rollover in any 12-month period.
Previously investors were allowed a yearly rollover for each IRA you held. For example, if an investor had multiple IRAs, they could roll each IRA over once a year.
But in a Tax Court decision from earlier this year (Tax Court Memo 2014-21), the judge ruled that, despite the Internal Revenue Service’s past leniency, the law clearly states that there is one annual rollover permitted per person, not one per IRA. This does not affect trustee-to-trustee transfers.
The clarification of the law actually does you a favor by reducing the temptation to make risky changes with your retirement savings. It is dangerous to treat your IRA as a source for short-term loans. If you are late on a repayment, even by a day, the tax ramifications can be harsh.
In the article, Robert Steen also provides some other IRA advice worthy of a quick read.
The Thrift Savings Plan (TSP) offers you the chance to save for additional retirement security at extremely low cost. But you may believe you don’t need to save for retirement because you’ll receive a pension after 20 years of service. Truth is, your military pension alone may not be enough.
Read the four reasons to contribute to the TSP in this article by Kisha A. Taylor at: http://www.militarysaves.org/blog/1214-4-reasons-to-contribute-to-the-tsp-despite-having-a-military-pension#sthash.I7efKH4c.dpuf