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Free Mentoring And Networking For Military Entrepreneurs

 

Sharks And Stripes 2: Camp Pendleton, CA, 13 June and live online.

Do you need a little help with your business idea? Are you growing your revenue but not sure how to reinvest it for growth? Are you worried about financing or interested in talking with an investor?

Image of Mr. Rey Ybarra standing on stage behind a podium to host the Sharks And Stripes entrepreneur conference | The-Military-Guide.com

Scenes from a previous Sharks And Stripes

Rey Ybarra has worked with entrepreneurs for years, and he even wrote the book about it. These

From: Military Retirement

USAAs Military Retirement Comparison Tool And The Blended Retirement System

 

Are you ready to make your choice about the militarys Blended Retirement System?

Are you a leader who has to advise younger officers and enlisted how to decide between High Three and the BRS?

Are you a veteran like me whos asked the question several times a week by their family (and their readers)?

USAA can help with that.

The Department of Defense is feverishly hustlingbuilding a calculator that will analyze which retirement system is better for servicemember careers and finances. The calculator was supposed to be launched back in January 2017 but its run into delays. (The contractors are fixing the last few bugs.) A few of us bloggers with DoDs BRS roundtable are helping with the beta testing, and its expected to go live at the end of March.

Meanwhile USAAs Military Retirement Comparison Tool is ready now. Its available to anyone through both their website and the USAA app. You dont have to login, and you dont even have to be a USAA member to use the website version.

This post is brought to you by Daniel Kopp, an Air Force officer and founder of MilitaryLifePlanning.com.

If youre interested in contributing at The-Military-Guide.com, please see our posting guidelines.

 

 

[Nords note: this post was updated on 4 March 2017 with a direct link to the DoDs PSMC website as well as a sample statement. Scroll down to the Summary section for the links.]

 

For any servicemembers who are transitioning out of the military or perhaps daydreaming about what that might look like someday, many of them have never considered the full impact that transition will have on their finances and total compensation. Most of the servicemembers that I counsel are surprised after they separate and dont have the same salary, benefits, or total compensation than they did in the military. So what can you do about this if youre set to separate or are thinking about it?

Every year, usually in early April, DFAS publishes the Personal Statement of Military Compensation (PSMC) with the intent to help make servicemembers full compensation more readily visible. While DFAS states that this may be helpful in applying for credit or loans, the true benefit lies in understanding what your equivalent compensation would need to be outside of the military to maintain your same standard of living.

 

So what is compensation?

In this context, compensation refers to the entire sum of salary, benefits, and other financial support that servicemembers receive. The majority is direct compensation money paid directly to you while the rest is called indirect compensation things that financially benefit you but arent a direct payment. Indirect compensation can either be financial compensation or non-financial. One example of indirect financial compensation is healthcare. When an employer helps pay for your healthcare coverage, thats indirect financial compensation since you otherwise would have to pay that amount. Indirect compensation can also be non-financial like leave. Direct compensation is readily apparent because these are clearly listed on your LES while indirect compensation might not be as immediately clear. The goal of this post is to help you understand the full picture of all of your compensation.

Its important to take a look at each detail of the PSMC since each analysis can differ based on personal circumstances. You can access your PSMC through Military Saves Week. (Its part of the 11th annual nation-wideAmerica Saves week, whichstarted in some regions as early as 2001.)

Logo of the military version of America Saves Week | The-Military-Guide.com

What are you saving for?

Its an awareness campaign with youropportunity to figure

From: Military Retirement

Lower Life Insurance Premiums From USAA

USAA is cutting the rates on their new life insurance policies. Let me explain why in less than 1800 2000 words but its all good.

Ive learned a lot about insurance over the last 30 years, and its a necessary evil. We buy it to help ourselves (and our families) recover from disasters, and we only keep it as long as we need it.

Everyone knows a story about someone who was devastated by a personal catastrophe which destroyed their finances.

Image of file cabinet with life insurance file next to family and finance files. | The-Military-Guide.comour posting guidelines.)

 

Ive always been drawn towards challenges. One day after high school I woke up and decided to look for the biggest challenge I could find. I quit my job and enlisted in the Marine Corps infantry. That night during our family dinner I broke the news like this Mom, I quit my job, joined the Marines, and leave in two weeks. Can you pass the salt?

In hindsight I probably should have softened the blow a bit, but my parents came around after a brief nervous breakdown.

I entered USMC boot camp in the late 90s weighing 115 pounds. This resulted in more than my fair share of quarterdeck time. Fast forward six months (bootcamp + school of infantry) and what seemed like 10 million pushups later, I weighed 165 pounds. The Marine Corps pushed me harder, mentally and physically, during that first six months than I knew I could go. But I liked it. Sure there was a lot of BS but I understood the bigger picture. They were breaking me down to build me up stronger. They were forcing me to rely on others. They were forcing others to rely on me. They were teaching us to rely on each other to move towards common goals.Image of U.S. Marine Corps Eagl</p><p>From: Military Retirement</p></div>
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<h2 class='post-title'><a href='news-headlines.asp?nid=356200&catid=0'>Military Blended Retirement System Spreadsheet</a></h2>
<div class='post-content'><p><p><em>This post is brought to you by <span style=MilitaryFIRE.com.
If youre interested in contributing at The-Military-Guide.com, please see our posting guidelines.

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A lot has been written about how to decide if the new Blended Retirement System (BRS) is better than the US militarys old retirement system. Most calculators, however are overly dependent on the service member forward projecting their:

  • likelihood of achieving 20 years
  • the inflation rate
  • the cost of living increases
  • their future rank
  • their future contributions to the TSP.

Overly cautious or optimistic guesses can have huge consequences.

It is stone cold obvious, to me, that anyone who plans on never staying to 20 years should jump on board the new system. It gives you access to a TSP match, continuation pay, and transferable benefits.

What does a member stand to gain from the BRS, in real terms?

Some assumptions:

  • Assumes all members contribute 5% in order to get the match.
  • Ignores the fact that the match is really 4%, with a 1% involuntary contribution.
  • Ignores all member contributions, and only examines the value of the government match and its return.
  • Assumes the member does NOT invest any of the 12 year continuation bonus. Again, member contributions happen with or without the government match. For those interested, the pay would be $17,217 and $10,665, taxable, respectively.
  • Assumes no COLA adjustments, inflation, or other macro economic factors, such as the cost of money.
  • Demonstrates annually compounded rates of return of 4, 5 &amp; 6%.
  • The members in this scenario are an Officer and Enlisted member with 5 years of service. This makes them eligible for the old system. However, they decided to enter into the BRS. Their TSP match is calculated based on 2017s pay chart.
  • Assume they achieve their terminal rank of O-4 and E-7 after 10 years, promoting regular beforehand.
  • Assumes 35 years of survivability after retirement, had they stayed for 20 years.
  • Ignores the .029% TSP fee.

Doug Nordman gives us two ways to calculate a pension: Lump sum and TIPS

[Nords note from other reader comments: I realize TIPS and I bonds arent exactly equivalent to a lifetime inflation-adjusted annuity, yet theyre close enough for these comparisons. The following examples used an interest rate of 2.5% w

From: Military Retirement

3 Steps to Retire Early on a Military Salary

This post is brought to you by Rich of RichOnMoney! If youre interested in contributing at The-Military-Guide.com, please see our posting guidelines.

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BLUF: In college I paid off $32k in student loans in a year. On a military salary I paid off a $280k mortgage in seven years. Ive bought several rental properties with cash. I did this through paying off debt, having a high savings rate, and investing well.

My name is Rich. Im an Air Force Lt Col of 16 years. Im married with 2 young kids.

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Here is my message:

Dont work until youre 65. Not even 55. You can save enough money to retire in 20 years or less. I mean after 20 years of work, NEVER WORK AGAIN (unless you want to). This method doesnt depend on a military retirement, thats just a bonus!

I currently make enough money from my investments to live on. I could quit working today, but Im less than four years from a generous military retirement.

I worked for Fidelity Investments as a stock broker during college. Ive read almost every finance and real estate book out there.

Most of what Ive read is useless. Money is strikingly simple.

Investing Made Easy post. In short, this is where you refuse to start a process because you dont feel confident in your plan or have complete understanding of a situation but the time for streaking is now!

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The beautiful thing with the fusion of technology and the ideology of Jack Bogle is that powerful and low-cost investing can be done on your cell phone in just a few minutes through Vanguard. Simply open an account, purchase some VTSAX if you have $10K to invest, VTSMX if you have $3K to invest, or heck VTI if you have $116. Once you have an account set up simply develop a focus on savings and put every extra penny in those accounts through automated deposits and extra lump sums (if you have already padded your emergency fund). Grab your phone, open an account on Vanguard, shove money at it, then rinse and repeat.

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For us military members its actually even more simple because we all have access to TSP (keep in mind this money isnt designed to be touched until age 59.5). A minute of free time on the MyPay site along with a decision on the percentage you want to save puts you well on your way. Take some time and read about the different funds you can invest in. I prefer the C fund because it tracks the S&amp;P 500 much like the index funds I recommended from vanguard but with even lower fees. Youll also have to make the decision on whether to go the Traditional o

From: Military Retirement

The 5 Best Personal Finance Books Ive Read All Year

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Im a voracious reader. I was that six-year-old kid you saw staggering out of the public library with a two-foot stack of books, and 50 years later Im still doing it. Over the first 45 years of my life I accumulated over 3000 paperbacks, which made me a fun guy to be around during military household goods moves. Hawaiis tropical climate (and critters) eventually forced me to give away that collection, and a Kindle app has restored our domestic harmony. Now Ill never run out of storage, and financial independence gives me even more time for reading.

Image of Amazon's &quot;Buy now with 1-Click&quot; button on the order page | The-Military-Guide.com

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