IRA's, TSP, and REI

[Mark Manship]

I'm a fairly new listener to the BP podcast; just got to #17, and am looking for any guidance/experience that any fellow "newbies" or vets have in allocating their capital, specifically with regards to their retirement investments (Roth IRA, Thrift Savings Plan, and Real Estate).

On Podcast #17, Jeff Brown mentions that the "traditional" vehicles towards retirement wealth are dated and end up disappointing their users at the age of 60+. I was a little late to the investment game, but started contributing fully to my Roth IRA in my mid-20's, and just recently started contributions to my TSP (military thrift savings plan) in an effort to diversify through established and well-known methods.

My concern after listening to Mr. Brown is following the path of least resistance when it comes to retirement planning; sure, maybe IRA's don't yield amazing returns, but are they still a sound means by which to save for retirement? It does seem like I would be the odd-man out if I didn't follow the crowd in investing in an IRA. After 3 years of IRA contributions, I have yet to see a ROI worth rejoicing about, and more importantly, nothing I'm seeing beats inflation. I wasn't expecting double digit returns by any means, however, I'm curious if anyone else has opted out of the IRA/TSP game in order to retain those contribution funds for REI?

My goals are somewhat ill-defined, in that I haven't narrowed in on what I would "need" to retire without a job, but in the essence of providing a benchmark for discussion purposes, let's say I would like to:

- Generate system of cash flow w/in next 10 years to supplement overseas travel expenses and hobbies for family of 5.

- Have enough wealth accumulated by age 45 to afford college tuition assistance for 1+ children

- Stop ALL W-2 work at the age of 60

- By age 60, have enough income through military retirement, cash flow, and other ROI to cover living expenses + leisure (travel, hobbies) for my wife and I; goal would be to have no mortgage on primary dwelling

- Establish a trust worth a darn to my wife, children, grandchildren, etc. (abilities to fund their own respective RE down payments, business ideas, education, etc.)