Remember if you retire under the age of 59 1/2 you can still withdraw from the TSP with no penalty.
I did years ago. It's a matter of lowest cost vs flexibility. If your are not interested in anything beyond an S&P, Russel 2000 or EFAE fund with the intention of trading no more than a few times a year then the TSP is your lowest cost option. But not by much. According to the TSP website the average expense ratio is .038. For every $1000 invested they charge you 38 cents. At my broker, Ameritrade. I can trade the Vanguard S&P 500 based ETF, IVV, commission free. The ETF charges an expense ratio of .04, or 40 cents for every $1000 I have invested.
Ameritrade offers over 100 commission free ETFs with expense rations from .04 to .51, average .29. Howerver if you trade that ETF within 30 days you are charged a commission, < $10 each way.
Plus other ETFs stocks and other securities can also be traded as often as I choose with out the the limit of the TSPs 2 trades per month.
Posted by: Gary <Tweet_pa@yahoo.com>
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