What would you say if I told you I got a $159k raise? Or better yet, nearly every officer with 17 years of service stationed in the DC area just got a $159k raise.
You probably think I had finally lost it, but I’d be right…
Hear me out: starting January 1st next year, these officers will receive an additional $847 monthly. That’s a 5.2% pay raise plus a BAH adjustment. Thank you, congress.
Now, some of you may need that extra bump in pay. This post isn’t for you, and that’s okay.
Most of my network likely has the family budget in order, so I’ll tell you what I’m doing: all $847 is going to my TSP until I retire.
Let’s revisit our hypothetical officer with 17 years of service. By age 65, three years of $847 monthly contribution turns into ~$159k at a 7.07% return or ~$90k at a 4.66% return.
Not bad. Pay yourself first.
PS
Not advice, just math.
PPS
Those rates represent the historical rates of return for L2040 and G Fund, respectively.