How much time do you dedicate to retirement planning? Are you preparing your troops for retirement or life after the military?

1SG Charmaine R. — Sat, 21 Feb 2015 01:15:10 -0500

I am often talking with junior leaders about our shelve life. Explaining to them that one thing is inevitable, which is a post-military life. We will all transition from the military at some point in our careers. Whether planned or unexpected, the goal is to ensure either path taken you and/or your Soldiers are financially and mentally prepared for that day.

Retirement Planning and having an adequate exit strategy is key. Understanding the job market, resume writing, and setting money aside for emergencies and retirement. So how are you preparing? What tools and/or advise would you give someone very junior in service as compared to someone with 15+ years in?

Response by CSM Charles Hayden made Feb 23 at 2015 12:02 AM

CSM Charles Hayden — Mon, 23 Feb 2015 00:02:52 -0500

Upon every opportunity I advise junior soldiers to become familiar w/ Financial Guru Dave Ramsey. With the new retirement system proposals the military is acknowledging the need for more financial knowledge for SMs.

Financial acumen coupled W/ SFC Mark Merino's knowledge of how so many young SMs sign-up for inferior educational programs will be extremely beneficial to our SMs

Response by CSM Private RallyPoint Member made Feb 24 at 2015 2:24 AM

CSM Private RallyPoint Member — Tue, 24 Feb 2015 02:24:08 -0500

Great post and often overlooked by leaders during counseling their Soldiers. I tend to focus more on retaining Soldiers to keep them in the service as opposed to providing a shining light toward the civilian life.

If the Soldier has their mind made up I will talk with them about what their plans look like upon leaving the service. I try to give them maximum amount of time to get all the assistance they can from separation services like ACAP.

Response by SrA Jonathan Carbonaro made Feb 24 at 2015 7:41 AM

SrA Jonathan Carbonaro — Tue, 24 Feb 2015 07:41:25 -0500

I would second CSM Charles Hayden's advice on Dave Ramsey. I've seen debt force people who wanted out of the military to stay in, or they had to use the money they saved up for the transition out to pay off their Star Card.

Honestly I think everyone should be financially prepared that today the feds could say "You're services are no longer needed" Or "You're going to come in and work, because your under contract and we will pay you when we can "find" the money." If you have no reserves set aside when that happens whether planned or unplanned, you're going to be desperate and desperate people do stupid stuff.

I'm saying that from a perspective of I have no debt, and have money set aside, and will set more money aside to prepare for my departure from Active Duty whether thats in 3 years or that is in 15 years.

With the new retirement system that they are planning, have they decided how those will affect retired and or currently serving vs. retired?

Response by SPC David Hannaman made Nov 13 at 2015 4:59 PM

SPC David Hannaman — Fri, 13 Nov 2015 16:59:34 -0500

Well, I can't speak specifically to the military aspect of it, but I think it's pretty universal.

There's a guy Dave Ramsey that has a class for soldiers (I think it might even be free). I've taught the civilian version of the class a few times, and the Gist of it is the seven Baby Steps:

1. $1,000 Emergency fund
2. Pay off all debt, smallest to largest.
3. 3-6 month emergency fund
3b. Save up for a down payment on a house, 15 year fixed loan, no more than 25% of your income.
4. 15% Retirement savings
5. Kids College
6. Pay off your house.
7. Continue saving, giving, and spending, enjoy... pass on a legacy to your children.

Step 2 is the one that always seems to be the hardest, at one time I owed credit cards about a year's salary. It took about 2 years for me to get it paid off, and that seems to be the average, then 7 years to pay off the house, and I'm nowhere close.

What it DID do though was when I got laid off three years ago it didn't bankrupt me. When My daughter ended up in the hospital with 15 major surgeries, it didn't bankrupt me...