4 tips for buying your first home on active duty - We Are The Mighty
MIGHTY MONEY

4 tips for buying your first home on active duty

Buying your first home on active duty may be intimidating and the jargon can be confusing, but the good news is that others have walked this path and made it through — and you will, too. Active duty service members and veterans have a secret weapon that civilians do not possess: the VA Guaranteed Loan. While the VA will not issue the loan itself, the guaranty provides the veteran with the means to obtain a loan without a down payment or mortgage insurance premiums.


First thing’s first; one must obtain a Certificate of Eligibility to prove their entitlement as per the VA fact sheet. The lender can obtain this on the veteran’s behalf, or the veteran may do it themselves through eBenefits to get started. The process may seem daunting at times, but these tips should help you along.

Explore VA Home Loans

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Estimate your monthly payment before you start looking at anything

A pre-approval letter determines your maximum loan amount, and is based on your credit and finances. This document may be requested from the loan officer or lender (bank) to calculate your monthly payments. You can estimate what your monthly payments will look like by using a mortgage calculator and the data contained in the pre-approval document.

Input your down payment (if any), maximum amount approved by the lender, and interest rate to have a realistic picture of what the payments are going to look like. Adjust the price of the home to determine an acceptable monthly mortgage for your situation.

4 tips for buying your first home on active duty

Maintain some savings for unexpected expenses

As a new homeowner, we can guarantee that you’ll run into unexpected costs. To prepare for these, make sure you have some sort of savings cushion — even if you aren’t buying a house, you should have some savings tucked away, just in case.

When you take out a loan and buy a house, you’ll encounter all sorts of unexpected expenses, like paying a funding fee, paying for inspections, and covering closing costs. Sure, you can roll several of these fees into your loan, but that’s just going to add to debt that you’ll already spend decades paying off.

In general, you should save as much as you can, but you should have at least ,000 – ,000 in reserve. Worst case scenario? You don’t use it all and you’ve got some extra cash.

4 tips for buying your first home on active duty

Find a realtor and lender with VA experience

If you’re diligent, you will find a realtor who is prior service and has walked a mile in your shoes. A lender like USAA (or other military-oriented lenders) can also offer a huge amount of help.

To find leads that will unite you with a realtor who understands your needs, reach out to your local military support group on Facebook for recommendations. A friendly inquiry can result in a list of individuals who have been recommended by your peers.

4 tips for buying your first home on active duty

Keep your options open

After the preliminary paperwork is complete, you’ll be able to place an offer on a potential home. There are a few scenarios that can unfold here: the seller may accept your offer right away, decide to wait for another offer but not deny your offer, or send a counteroffer. It is absolutely essential to know that you may place offers on several homes at once.

However, once you have an offer accepted by a seller, you are obligated by contract (as per the purchase agreement) to not place new offers on other homes.

MIGHTY CULTURE

These are some of the best federal jobs for veterans

The federal government invests a lot of time and money into training service members of the armed forces. As a result, it’s to the advantage of the government to retain service members for as long as possible. Retention programs and bonuses incentivize service members to stay in, but if you no longer wish to volunteer for an all-volunteer service, you can leave (provided your contract is up, of course).

After all, skills and certifications acquired in the military are highly sought after in the civilian workforce. Whether you’re a missileer who goes to work for Raytheon, an intel analyst with a secret clearance who gets scooped up by Booz Allen Hamilton or a diesel mechanic who takes a job with Union Pacific, your experience and training in the military makes you a valuable asset to any organization. For those that want to continue serving their country outside of the military, many federal agencies are more than willing to hire vets to fill their ranks.


In 2009, President Obama signed an executive order establishing the Veterans Employment Initiative. Meant to promote the hiring of veterans in the executive branch, the program has also served as a model for companies in the private sector to make hiring veterans a priority. “As the nation’s leading employers, the federal government is in need of highly skilled individuals to meet agency staffing needs and to support mission objectives,” said the director of veteran services at the U.S. Office of Personnel Management and Air Force vet, Hakeem Basheerud-Deen. “Veterans get a lot of training and development during their military service, and their wide variety of skills and experience—as well as their motivation for public service—can help fulfill federal agencies’ staffing needs.” In no particular order, these are some of the best federal jobs for veterans of any background.

4 tips for buying your first home on active duty

(National Park Service)

1. Park Ranger

If you’ve been stationed in Alaska, Colorado, Fort Drum (you have our condolences) or any other location where outdoor activities are plentiful, you may have developed an affinity for open-air recreation. If you have, you might consider a job as a ranger for the National Park Service. As a ranger, you would investigate complaints and violations of park regulations, provide visitors with guidance and information, and generally protect the land set aside for future generations to enjoy. If an office job sounds like a prison sentence, this might be the job for you.

4 tips for buying your first home on active duty

(Fort Bliss Public Affairs Office via DVIDS)

2. Law Enforcement

Looking for a post-military career that will keep you in the action? You might consider a job in federal law enforcement. This is a very broad job field, though. You could work as a federal police officer at a military installation, a park police officer under the National Park Service or even an FBI agent serving as a legal attaché to an overseas embassy.

Another commonly thought of job under this umbrella is Border Patrol Agent. However, under Customs and Border Protection, you can also find CBP Officers. These are the men and women who protect the country at all ports of entry. From screening passengers at passport control to combing through cargo containers for illicit cargo, CBP Officers oversee everything coming into the country. Aside from DEA and FBI agents who train at Quantico, Federal Law Enforcement agents train at specialized Federal Law Enforcement Training Centers. FLETC is headquartered at the former Naval Air Station Glynco in Georgia and operates two other residential training sites in Artesia, New Mexico and Charleston, South Carolina.

4 tips for buying your first home on active duty

(207th Regional Support Group via DVIDS)

3. Human Resources

Paperwork is the lifeblood of the government. It moves information, initiates action, and can mean the difference between you getting paid or owing money. Though many systems have moved online to database or system entries, there is still a plethora of Standard and Agency-specific Forms that the federal government relies on.

Coming from the military, you’ll be familiar with having to fill out paperwork for everything from life insurance and emergency contacts to leave requests and requisition forms. Though more senior positions might require civilian HR certifications (a good time to use that post-9/11 GI Bill), there are still entry-level positions that allow veterans to get their foot in the door with their service experience alone. If it’s not on paper, it didn’t happen.

4 tips for buying your first home on active duty

(U.S. Army Drill Sergeant Academy via DVIDS)

4. Range Tech

Almost everyone who has donned the uniform has been to a range. Even some chaplains hop on the firing line to test their aim (unofficially, of course). You know those civilians who run the computers? You could be one of them! Though some bases contract these jobs out to private companies, there are still jobs that pop up on USAJobs.gov for range tech positions across the country.

As long as you have some experience learning something new and working with your hands (you went to basic training, after all), you’re good to go. Now, there’s a bit more to it than just pressing buttons, laughing at the people who struggle to qualify, and refreshing the ancient program running on Windows 95. But, if you like being on the firing line and you’re willing to learn how to maintain and operate a range, this job could be your perfect fit.

4 tips for buying your first home on active duty

(USPS)

5. Postal Service

As of February 2020, the USPS employs more than 97,000 veterans and is one of the largest employers of veterans in the country. Don’t want to be a letter carrier or work customer service? Contrary to popular belief, Postal Service careers extend beyond the aforementioned positions. USPS offers careers in accounting and finance, operations, marketing and sales, human resources and admin, processing and delivery, and many more. If you’ve deployed overseas, you know just how valuable mail is. Especially during the COVID-19 timeframe, the personal touch of a physical letter can be just what someone needs to brighten their day. Neither snow nor rain nor heat nor gloom of night…

Whether you’re retiring from the military or separating after your first contract, your service and experience in the armed forces sets you apart from people that haven’t served. A federal job allows you to continue that service. A steady paycheck and maintaining your TSP aren’t bad perks either.


Articles

This military spouse grew her own business despite 2 PCS moves

4 tips for buying your first home on active duty
Lakesha Cole was named the 2014 AFI Military Spouse of the Year in a ceremony in Washington, DC in May, 2014


In many ways, Lakesha Cole is the typical military spouse. A mother and wife, Cole has spent the last five years like many other military spouses: focused on a passion while juggling her family responsibilities.

But it’s the way she’s done it that sets her apart. Recently, Cole and her husband, Gunnery Sgt. Deonte Cole, and their children completed a Permanent Change of Station from Okinawa, Japan, to Camp Lejeune, North Carolina.

And along with their kids and personal effects, the Coles also took their successful business inside the Okinawa Exchange with them.

This was the second time Cole packed up her company, She Swank Too, and hauled it overseas. Two years after debuting their company aboard Camp Pendleton, California, the Cole’s took on a PCS to Okinawa, embarking on a mission to open the first brick and mortar She Swank Too there.

Cole spoke with We Are the Mighty about her experience just trying to get a meeting with the retail manager in Okinawa.

“He was reluctant to do business with me,” she recalled, after waiting for six months to secure a meeting with the manager. He argued that military spouses didn’t believe “the rules apply to them,” citing spouses who formerly ran businesses in the retail space with poor business practices.

Cole says she presented her business plan, complete with financial reports, customer data and testimonials, and samples, to the manager. They agreed to a 30 day trial run of a brick and mortar She Swank Too. Three years later, the store accompanied the Coles on their PCS.

When asked what steps an entrepreneur should take during a PCS, Cole was quick to answer, “Stay active and… communicate with your customers.” Customer interaction is one of the focal points of the company. “We tapped into the hearts and homes of our customers,” Cole said.

The motivation behind the company was simple. “We debuted our first children’s collection … to introduce entrepreneurship to our daughter,” Cole recalled.

Cole’s husband is equally involved in the business. “The least recognized role in a business is … that person’s spouse,” Cole said. Cole’s husband is not only an active participant in the company, but a financial investor as well.

Cole isn’t just a business owner. In addition to She Swank Too, Cole is a military spouse retail coach, the founder, CEO and owner of Milspousepreneur, and an active advocate for military affiliated entrepreneurship in hopes of reversing high milspouse unemployment.

“My focus remains in using this business as a vehicle to give back,” Cole said

MIGHTY MILSPOUSE

The pros and cons of a separate bank account from your spouse

Mina and Jason Burbridge have been married for two years. She’s 47. He’s 48, and they’ve always maintained separate bank accounts. It gives the Boston couple some freedom to act unilaterally. As Mina says, “If he wants to buy something that’s dumb, he can do it. And so can I.”

They also set up a joint account early on in order to pay for big household expenses, although another motivation came right before their October 2015 wedding. Mina’s account was hacked into and had to be frozen for two weeks as the situation was rectified. The incident made them realize the benefit of two things: spreading their money around and having some always be mutually accessible, she says.


But the separate accounts have continued to show their worth. Mina is a psychologist and clinical trainer. Jason works from home, building a business buying and selling baseball cards. It’s all online, much of it on eBay, and having distinct accounts provides another layer of protection, as he could be doing 20 transactions a day, Jason says.

Mina and Jason’s arrangement is not as atypical as it may seem. A Bank of America study found that Millennial couples have separate bank accounts more than twice as much as Generation X and Baby Boomers. At first glance, it could be seen as affirming their independence and pushing back against the idea that marriage has changed much in their lives. But it’s more than that, says Dr. Robyn Landow, a psychologist in New York City.

4 tips for buying your first home on active duty

(Photo by Evan Forester)

Millennials are waiting to tie the knot. A Gallup poll showed that 27 percent of Millennials are married versus 36 percent of Gen Xers and 48 percent of Boomers at comparable ages. Couples often live together for longer and have separate accounts, and, when they do marry, they don’t change the setup. It’s part inertia, part lack of urgency, part, “If it ain’t broke,” Landow says.

Still, while said couples may not see a need, having a joint account carries symbolic and concrete weight. It’s an awareness that there’s now an “ours”, which one day might involve expenses for houses, children and extended family. There’s the above-mentioned minimizing risk and making money available for a worst case scenario. And on a more granular level, a check made out to both people – gift, joint tax return refund – is an easier deposit if both names are on the account, says Brian Haney, financial adviser in Silver Spring, Maryland.

But the type of account in and of itself doesn’t predict or guarantee marital success or failure. Trust, commitment, and love are still the must-haves, says Landow, adding “The truth is if someone wants to hide or withhold money, with enough planning, they could do it.”

Whatever the system, couples first need to understand each other’s financial type. It involves figuring out whether a person believes in enjoying life as it comes, or in being a hardcore saver, always wanting something in the bank in case of emergencies, which Haney says, are not theoretical occurrences but realities. When attitudes are talked about, decisions become less arbitrary. “It makes it easier to know where you’re coming from and easier to find common ground,” he says.

4 tips for buying your first home on active duty

(Flickr / reynermedia)

And if all that’s in place, responsible people can make individual accounts work – it just becomes a matter of assigning out the bills. But the setup loses the macro perspective of building something together. “You’re not roommates,” Haney says. In other words? Being married means sharing all parts of life – one house, one bed – and money is another component.

The joint account takes down barriers, because, especially when using a budgeting tool such as Mint, a couple can see all money coming in and going out. The information may be uncomfortable, but with everything out in the open, problems can be reconciled, plans can be tweaked, and spouses can make more informed decisions based on what they want.

“It reinforces stability in your relationship,” Haney says. “You’re a team, and when you keep things separate, it’s harder to be a team.”

That doesn’t mean individuals accounts don’t have a place, whether it’s for surprise gifts, the occasional indulgence, or something else. They just need to be another joint decision in what they’re going to look like and be used for. And to help get to the decision, Haney says to merely look at the monthly budget. The numbers will provide the answer to what’s needed for shared expenses, and then how much partners can donate to themselves. The approach is more detached, less emotional. “It takes the feelings out,” he says. The big thing is that it’s discussed and transparent to prevent suspicion, surprises and distrust.

“If you know it, you may not like it, but you can deal with it,” Haney says. “But if you don’t know, you automatically don’t like it. The unknown is always uncomfortable. It’s never comfortable.”

This article originally appeared on Fatherly. Follow @FatherlyHQ on Twitter.

MIGHTY MONEY

T-Mobile will give its biggest discount ever to the military

Supporting the military is nothing new to T-Mobile. The carrier is one of America’s most dedicated veteran employers. In keeping with the practice of asking customers what they want and giving it to them, T-mobile asked its veteran employees what they needed. The veterans answered truthfully. T-Mobile listened — in a big way.


“We change to adapt to our customers’ needs, we listen to their pain points” says Matt Staneff, Executive Vice President and Chief Commercial Officer of T-Mobile. “Our veteran employees and customers transitioning out of the military were just making ends meet during long periods of unemployment.”

And so began the company’s Military Support Initiative.

4 tips for buying your first home on active duty
T-Mobile’s veteran employees who participated in the 2017 NYC Veterans Day Parade
(Twitter @JohnLegere, T-Mobile CEO)

T-Mobile decided to go all-in for the military-veteran community in a number of ways. On top of the benefits of buying into T-Mobile’s ONE family plan (of which there are many, including a Netflix subscription), T-Mobile will now offer that plan at half-off for military families — along with half-off of popular Samsung smartphones. It’s not just the biggest discount T-Mobile has ever offered, it’s the biggest discount in the wireless industry. Ever.

But the carrier’s plan is more than just a discount and some great service, it’s a real investment in military communities. It starts with the discount, but T-Mobile quickly recognized that making it easier for transitioning military families to make ends meet was solving only part of the bigger problem: the long period of unemployment. So, T-Mobile decided to do something about that, too.

“Our plan to hire military veterans has had phenomenal success to date,” says Staneff. “We have vets in every department performing very well. What veterans bring to the culture of T-Mobile is one of the keys to our success.”

4 tips for buying your first home on active duty
The Military Honors Wall at T-Mobile’s Snoqualmie, Wash. office
(Twitter @NevilleRay)

A few years back, the company pledged to hire some 5,000 veteran employees, and not just for entry-level positions. The company employs vets at all levels and in all areas. Now, they’ve pledged to hire 10,000 more veterans — and their spouses — in the next five years.

“It took a lot of time thinking about what I wanted to do during transition,” says Tana Avellar, once an active duty Army officer who now serves in the Washington State National Guard. She is also a T-Mobile employee. “I can’t be more proud to work for a company that is such an advocate for their employees, veterans, and their families overall.”

4 tips for buying your first home on active duty
Avellar in her National Guard role.
(Photo from Tana Avellar)

But T-Mobile is looking to help out all veterans, not just the ones who want to work for them. It’s teaming up with FourBlock, a career readiness nonprofit designed for veterans and their families. The company is funding FourBlock’s Massive Open Online Course, a training course based in 15 cities in the U.S. (with four more on the way). The training helps spouses gain employment while giving them the confidence to pursue the jobs they’re more than qualified to do.

The last part of T-Mobile’s investment plan is a real investment, in both T-Mobile’s future and military families. The company is rolling out a $8 billion investment in new infrastructure, and will start that with a $500 million plan to build new 5G towers in military communities.

“Our mission is to have the best coverage for all Americans,” says Staneff. “And bases aren’t always near big cities. So, we wanted to make sure everyone had access to the fastest networks, whether they live in cities or rural small towns, military bases or somewhere in between. They all deserve the same access.”

Articles

A Fort Bragg soldier won $2 million and definitely won’t blow it on these 9 things

On Jan. 13, Fort Bragg Army Reserve soldier Johnny Charlestin was celebrating his birthday when he learned that a $3 Powerball ticket he bought was a $2 million winner.


“I didn’t believe it, it was a feeling I’ll never forget,” Charlestin said in a press release from the N.C. Education Lottery. “It’s the best birthday present I’ve ever had.”

Charlestin then decided to leave the public spotlight, which is one of the things experts recommend lottery winners do. Hopefully this means he’s smart enough to invest the money wisely.

But since he’s a Fort Bragg soldier, there’s also a real chance he’ll spend his money this way:

1. Taxes will be taken out

4 tips for buying your first home on active duty
Photo: flickr/Ken Teegardin, Senior Living Center

30.75 percent, or $615,000 goes right back into government coffers. That leaves the enterprising soldier with $1,385,000.

2. Dip and jerky

4 tips for buying your first home on active duty
Photo: Wikimedia Commons/OAC

The winner’s first stop will be base shoppette where he’ll pick up the proper amount of dip for millionaire soldiers, as well as a little jerky to much on.

3. New car

4 tips for buying your first home on active duty
GIF: Giphy

This is an obvious stop, but for some reason, the new millionaire will still take out loans of 20 percent or more. Over the next five years, that b-tchin’ Corvette will cost him as much as a Lambo would’ve if he’d paid cash.

4. Electronics store

4 tips for buying your first home on active duty
Photo: Wikipedia/Chris McClave

Every new video game console, 10-20 games for each, a huge TV, and surround sound. A few movies will round out the purchase, about 500 of them. Most of the movies are about World War II paratroopers.

5. Adult “book” store

4 tips for buying your first home on active duty
Photo: flickr/leyla.a

This is for other movies. We will not explain further.

6. House

4 tips for buying your first home on active duty
Wikipedia/Andrew (Tawker)

Finally, the soldier will find a new place to live. Unfortunately, he’ll only realize after the fact that his surround system doesn’t properly fill the new entertainment room with sound. Since he threw away the receipts, he’ll buy a new one and give the old system to a groupie (he’ll have those now).

7. Energy drinks

4 tips for buying your first home on active duty

This will take up more money than any non-soldiers would expect.

8. All the booze

4 tips for buying your first home on active duty

There are roughly infinity liquor stores at the Fort Bragg perimeter, as well as a Class VI store on base. These will become empty.

9. Noise citations

4 tips for buying your first home on active duty
Photo: Wikipedia/Highway Patrol Images

Once the party starts, Fayettnam police officers will be visiting every 15 minutes or so and writing a ticket. By the end of the night, the lottery money will be almost played out.

By the second week, the former millionaire will be attending finance classes on base and applying for an Army Emergency Relief loan to make his payments for the Corvette.

Humor

24 people to marry with better benefits than a US service member

Recently, the military healthcare system Tricare posted a photo on its Facebook page that had its fans in a frenzy.


People got pissed; they complained; they shared the post with harsh words; some even used “caps lock” in their comments. It was terrible.

What was so offensive about the post, you ask? If you hadn’t already seen it, it was a wedding photo with the comment “You had me at #TRICARE.” See below.

4 tips for buying your first home on active duty
Tricare recently posted what was supposed to be a humorous post to its Facebook page. Instead, it got a lot of backlash!

As someone who works online almost exclusively, I had to laugh at the post. In fact, I laughed a lot. I could understand why some people were upset (hello, pushing a negative stereotype on female military spouses), but mostly I couldn’t understand how the marketing department at Tricare saw the post and said “Oh hey, THIS post is an EXCELLENT idea!”

My first reaction when I saw it, honestly, was “I wonder how long whomever approved this post will have a job?” I post all kinds of crazy things on my own personal Facebook page, but I’ve been called into more than one come-to-Jesus meeting with a boss over a poorly planned social media post.

When that’s your job, you have to be aware of your audience.

And who is the audience for most of Tricare’s social media pages? Probably spouses who want to keep up with changes in Tricare benefits. So it’s no small wonder that a whole bunch of them were butthurt.

So I did what any responsible journalist in my position would do: I shared the flub on my personal Facebook page and asked for hilarious feedback. My friends did not disappoint.

The idea? If we were to marry someone for his benefits, couldn’t we have chosen someone with better perks?

The military benefits are great, don’t get me wrong. But what about if you married:

1. A mob boss

All the Italian food your heart desires and the destruction of your mortal enemies. (this is obviously my first choice)

2. Prince Harry

Crowns and gowns, you’d never have to work! (wait. maybe this is my first choice)

3. United State Senator or Representative

The best health care your tax dollars can buy. Plus no one’s allowed to hurt your feelings. (gag me now)

4. A doctor

All you can eat hospital food! (food? queue the fat dependa jokes, because I AM IN)

5. A dog breeder

Picks of the litter! (meh, I’m not really a puppy person. Don’t shoot me, I prefer a full-grown rescue)

6. Donald Trump

If you ever go bald or are in desperate need of a tanning bed, you’re already in the right place! (If you can stomach this, its an option for those of you under 25!)

7. Any president

Free food, vacations all over the world; top private schools for kids; secret service body guards; couple cabins in the woods; free airfare!! (Woah woah woah…. someone sign my husband up!)

8. A Masseuse

Happy massages for days. (Okay I’m really torn between this one and Prince Harry. Can we choose two?)

9. Bill Gates

When one door closes the windows are always open!! (I’m a Mac girl, so…)

10. A handyman

All the crap around the house might actually get done! (Except my daddy raised me to be able to DO all the crap around the house, so this isn’t an issue here.)

11. Cesar Milan (the dog whisperer)

Maybe he can make the kids behave! (Wait, I have to choose between behaving kids and Prince Harry? Adulting is hard.)

12. A plastic surgeon

Think this speaks for itself. (Meh, not really my cup of tea)

13. A Starbucks barista

I think this also speaks for itself. (Okay, so do you think Harry could make coffee AND be a mob boss AND be a masseuse? Someone with connections find this out for me?)

14. An airline Pilot

Get to travel for free or for little out-of-pocket when there are seats available. (I’m married to a pilot. I see how he drives, I DO NOT want to fly with him.)

15. A personal trainer and chef

Never have to cook again and always fit into your skinny jeans! (I already fit into my skinny jeans. I just buy them bigger now.)

16. A hotel manager

Free room and board with complimentary continental breakfast! (I do enjoy food…)

17. A mechanic

(Free oil changes?)

18. Matt Damon

He’s my fantasy celebrity boyfriend and I’m waiting for his proposal. (Obviously this wasn’t my suggestion. If it’s not obvious, I super like Prince Harry. Just saying.)

19. A farmer

Cheap help from laborers, tractors and back hoes to dig as many holes as I need to bury the bodies. Then, when the old man ain’t worth it anymore I just take him out to pasture on the back 40! (So maybe not husband material, but maybe as a side piece while I’m married to the mob boss? Questions need to be asked here.)

20. A coffee importer

I would always have the best coffee. Ooh or someone who owns a bookstore too! Unlimited coffee and books for life it can’t get any better than that. (Just out of curiosity, does anyone know if Prince Harry has a library? Asking for a friend.)

21. The owner of a winery

(Also need to find out how Harry feels about wine)

22. A civilian so you never have to sleep alone

…Or worry. (I know, too serious)

23. A Costco employee

I used to work at Aetna. Let me tell you — those folks get great insurance. Or they used to. Free glasses once a year for all members of the family. (It IS time for me to get new glasses.)

24. The heir to a million dollar business with really nice in laws

No wait.. better! Heir to an awesome chocolate company. (Note to self, find out how Prince Harry feels about wine and chocolate and masseuse school and libraries and…)

I just realized that Prince Harry is in the military as well, so maybe I just really appreciate a man in uniform and the benefits aren’t really even the icing on the cake.

MIGHTY MONEY

Finance Friday: should you invest in a bear market?

As I sit in my concrete bunker surrounded by hand sanitizer and disinfectant wipes, a wall of toilet paper ready to thwart any potential Coronavirus threats, I feel the need to press pause on regularly scheduled mortgage education and address a topic that has flared up in newsfeeds over the past few days: investing when the market has “crashed”.


Although I joke about my bunker stash (I can’t even find hand sanitizer to stock), personal finance is a highly individualistic and serious subject full of licensing requirements and government regulations. I did what any person not wanting to bring the Financial Industry Regulation Authority fire down upon them and called in the experts. Long-time trusted advisors Nick Stone and Craig Harris were both able to offer some advice to my investment-curious audience who feel that they may be missing out on a Golden Goose Egg during this bear market.

Stone provided examples over the history of time where markets have typical cycles of ebb and flow, and this was bound to come full circle even before the Coronavirus scare (which surely did compound the effect). Putting our economy into the analogy of a marathon, no one sprints 26.2 miles to a finish line. Instead, there are steady-set paces accompanied by throttles and breaks. We may not have seen the bottom of this yet since stocks are priced on what expected earnings are, and companies have yet to report on their current quarter. It could be speculated that markets will dip even a little more. Only time can tell. A piece of advice offered is to maximize on your current contributions such as 401K, IRA and other tax-friendly opportunities versus a narrow lump-sum investment to allow for dollar-cost averaging.

4 tips for buying your first home on active duty

Harris emphasized a good time to invest when the market is in a down point. “Buy low and sell high” is not a catch-phrase but a pillar of investing. Regardless of market conditions, ANY time is a good time to start investing, but there is certainly an advantage when we are in a low market since you can get a little more with your cash. Even at the highest point, like where we just were, there is still a good strategy to be employed for investing your money. Nothing is ever guaranteed, but the market is designed in a way that, over a long enough period of time, your money should grow. He stressed that individual situations and goals are the primary driving factor in how the portfolio is built and how your money can be invested wisely.

4 tips for buying your first home on active duty

Both discourage dumping money blindly into crashing stocks today in hopes of getting rich next week. The singular most important thing you can do with your money is to have a goal in mind versus chasing performance returns. It can be retirement, paying for a child’s college, purchasing a home, etc. but you HAVE to know what you’re working towards in order to get there. The last thing you want to do is be cash-poor and investment-rich without a plan if you need access to that money in the short term. This knowledge is especially important for my mortgage clients who may need to hang on to some cash to close on a new home.

4 tips for buying your first home on active duty

There’s a big myth out there that financial advisors are expensive, but they’re really not. There are traditional brokerage accounts where you pay a small commission on everything bought and put into your account and every transaction made on your behalf. There are also fee-based accounts where you forego commissions and pay an annual fee that varies between firms, typically averages out to be less than 1.5 percent of your invested assets. If you find yourself shopping around for a financial advisor, ask about their cost, make sure they are also a licensed stockbroker so you are diversified instead of pigeonholed into one certain commodity, and ask them if they would invest you like they would invest their own family. It’s a relationship of trust, and you have the ability to establish how you want that relationship to be shaped, whether it be by twice a year comprehensive reviews, weekly phone calls or somewhere in-between.

Important to remember when you see big movement in the economy is this: What do you want to invest FOR, not what do you want to invest IN. That mind shift will help you make smart financial decisions for your future.

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Commissary savings overhaul might cost shoppers extra

A recent overhaul of the defense commissary program aboard military installations will result in higher costs for its customers, according to a recent MilitaryTimes report.


New rules, which were put in place as part of the latest annual defense authorization act allow the defense commissaries, or DeCA, to up the prices on about 1,000 products in 10 stores. Additionally, all 238 commissaries were authorized to raise prices on national brand products.

According to MilitaryTimes, this will allow officials to explore how the overall impact of raising these prices might help them to reduce operating costs that taxpayers cover, which currently sits at about $1.3 billion annually.

Before the rollout of the overhaul, DeCA was able to sell items at the commissaries at cost plus 5 percent. Under the new system, DeCA is able to purchase items at a reduced rate, but sell them at their previous rates or higher.

For example, if DeCA purchases a product at $.10 cheaper than before, it might not sell that product for the reduced price at the commissary, MilitaryTimes explains.

That extra cash might go, instead, toward operating costs or toward lowering the price of a different product, or both.

One of the issues with this new system, according to MilitaryTimes, is that the consulting company who designed it may be benefitting financially. MilitaryTimes claims that “unofficial reports from members of industry” say that Boston Consulting Group (or BCG) stands to make between 50 and 60 percent of the amount prices are reduced.

So that dime savings per sale of a particular item might net BCG between a nickel and 6 cents per unit sold.

DeCA officials are unable to confirm those claims, saying instead that the details of extra awards, fees or incentives for BCG won’t be available until they are “determined at a later date”, MilitaryTimes says.

Chris Burns, the executive director of business transformation at DeCA, told MilitaryTimes that the money DeCA saves is going toward reducing product prices or toward operating costs, but MilitaryTimes could not determine if consulting fees were included in those operating costs.

The effects of the overhaul are being felt elsewhere, as well. Some national brands who are pressured to lower prices below cost are pulling their items from the commissary altogether, MilitaryTimes reports. They claim that “multiple sources” are saying that other programs, like scholarship donations, could be cut.

Some good news does come out of the overhaul, however. DeCA will begin rolling out store brand items later this month that should be cheaper than national name brands.

While Congress approved the Department of Defense’s DeCA program, they are keeping a close eye on it and on whether it actually saves anyone money, MilitaryTimes says.

MIGHTY MONEY

Designer of the F-15 & AH-64 is responsible for 30% rise in Dow this year

A single company, Boeing, has accounted for nearly 30% of the Dow Jones Industrial Average’s year-to-date gain of 11.5%, according to Bespoke Investment Group.

Boeing shares have soared 34% this year, contributing 812 points of the index’s 2,807-point gain so far this year. Without Boeing’s contribution, the index would be up about 8% YTD.


4 tips for buying your first home on active duty

(Bespoke Investment Group)

The index’s outsized gain is driven by Boeing having the heaviest weighting, 11.4%, among the Dow’s 30 stocks. The Dow is a price-weighted index, meaning the company with the highest share price, Boeing, has the heaviest weighting. Boeing’s stock price is the highest in the index and the only one over 0.

Unlike the Dow, the SP 500 is weighted by market cap, meaning Microsoft has the heaviest weighting. By comparison, Boeing commands the 15th biggest weighting of SP 500 names.

Such effects cut both ways and a 10% move in Boeing’s stock would move the DJIA index by over 250 points. The second-highest contributor to the Dow is Goldman Sachs, responsible for about 8% of the YTD gain.

Boeing shares were trading near all-time highs thanks to strong fundamentals and solid earnings growth based on the planned launch and development of the 777X, the largest and most-efficient twin-engine plane.

On Jan. 30, 2019, Boeing reporting strong quarterly results, with annual revenues topping 0 billion for the first time. The company forecast full-year 2019 earnings of between .90 and .10 a share, well ahead of Wall Street expectations.

This article originally appeared on Business Insider. Follow @BusinessInsider on Twitter.

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There’s no business like the arms business — here’s how defense giants are doing

Nobody spends money on arms like the US of A.


Starting with a base of $534 billion in discretionary funding, coupled with another $51 billion for Overseas Contingency Operations funding (aka the “war budget”), the Pentagon’s spending power comes to a grand total of $585 billion.

Defense industry giants, Boeing, General Dynamics, Northrop Grumman, and Raytheon posted second-quarter earnings on Wednesday (Lockheed Martin earnings released last week).

Here’s a look at how they did…

Boeing

4 tips for buying your first home on active duty
Boeing KC-46 Tanker program first test aircraft (EMD1) flies with an aerial refueling boom installed on its fifth flight. | Boeing

Boeing, the world’s largest plane maker, reported a smaller-than-expected second Q2 loss on Wednesday. The company’s first quarterly net loss in nearly seven years amounted to $234 million.

Boeing’s KC-46 tanker program for the US Air Force is delayed from August 2017 until January 2018 due to test flight problems. Modifications to the aircraft are expected to cost Boeing an additional $393 million (after taxes).

What’s more, Boeing could end production of its most iconic aircraft.

“If we are unable to obtain sufficient orders and/or market, production and other risks cannot be mitigated, we could record additional losses that may be material, and it is reasonably possible that we could decide to end production of the 747,” Boeing said in its filing on Wednesday.

Earlier this year, Boeing won a US Air Force contract worth $25.8 million to start work on the next fleet of Air Force One aircraft.

The aging Air Force One and it’s twin decoy will be replaced with two Boeing  747-8 and are expected to be operational in 2020.

Up to Wednesday’s close of $135.96, the company’s shares had fallen about 6% since the start of the year.

Highlights from Boeing’s quarterly earnings report:

•Operating cash flow of $1.2 billion (with 28.6 million shares repurchased for $3.5 billion)

•Cash flow of $3.2 billion, (down 2% from 2015)

•Core earnings per share loss of $0.44

•Revenue rose 1% to $24.8 billion (from earlier estimate of $24.5 billion)

• Demand still high with more than 5,700 commercial plane orders still in the works

Reuters contributed to this report.

General Dynamics

4 tips for buying your first home on active duty
The littoral combat ship USS Independence operates off the Hawaiian Islands during exercise RIMPAC 2014. | General Dynamics

General Dynamics began their earnings conference call on Wednesday highlighting their “very good second quarter.”

The Falls Church, Virginia-based company announced $7.6 billion in Q2 revenue and achieved $758 million in net earnings.

General Dynamics recognized their aerospace unit (with a revenue of $2.13 billion) and maritime division.

At the end of June 2016, the defense giants’ National Steel and Shipbuilding division won a $640 million Pentagon contract to construct a T-AO 205 Class Fleet Replenishment Oiler. The contract could be worth up to $3.16 billion if the Pentagon decides to buy an additional five ships.

In March, the US Navy announced that General Dynamics will be the prime contractor for development of 12 new submarines.

Shares rose less than 1% to $145.09 in the afternoon and since the beginning of this year, the company’s stock has climbed 5.2%.

Highlights from General Dynamics’ quarterly earnings report:

•Revenue fell to $7.67 billion (down by $217 million from the Q2 2015)

•Raised 2016’s full-year earnings forecast to $9.70 per share (from $9.20, analysts’ expect $9.52)

•Profit margins could be as high as 13.8% (up from January 2016 estimate of 13.3%)

Reuters contributed to this report.

Lockheed Martin

4 tips for buying your first home on active duty
Behold, the F-35. | Lockheed Martin

While the F-35 Lightning II continues its turbulent march to combat readiness, the jet’s manufacturer posted better than expected quarterly revenue earnings last week.

Lockheed Martin, the Pentagon’s top weapons supplier, also lifted its 2016 revenue and profit forecasts for a second time — despite significant snags in developing America’s most expensive arms program.

Considered a bellwether for the US defense sector, Lockheed Martin’s stock also posted  a record high of $261.37 in early trading on July 19. What’s more, the world’s largest defense contractor’s shares were already up approximately 18% this year.

“(The) consensus expectations are finally positive for the F-35 and for improvement in the defense budget, which has led to a higher valuation,” Bernstein analyst Douglas Harned wrote in a note, according to Reuters.

The now nearly $400 billion F-35 weapons program was developed in 2001 to replace the US military’s F-15, F-16, and F-18 aircraft.

Read more about the F-35 »

According to Lockheed Martin, sales in its aeronautics business, the company’s largest, rose 6% in the past three months due to delivery of 14 F-35s.

The company has said it plans to deliver 53 F-35 jets in 2016, up from 45 a year earlier.

Highlights from Lockheed Martin’s quarterly earnings report:

• Net sales rose to $12.91 billion (from $11.64 billion in Q2 2015)

•Net income rose to $1.02 billion (or $3.32 per share), which is up from $929 million (or $2.94 per share) in Q2 2015

•Generated $1.5 billion in cash from operations

•Raised 2016’s profit forecast to $12.15–$12.45 per share (from $11.50-$11.80)

•Raised 2016’s full-year sales of $50.0 billion-$51.5 billion (from earlier estimate of $49.6 billion-$51.1 billion)

Reuters contributed to this report.

Northrop Grumman

4 tips for buying your first home on active duty
Northrop Grumman/EADS Euro Hawk rollout on October 8, 2009 at Palmdale, CA, USA. | Northrop Grumman

Northrop Grumman’s earnings report showed sales reaching $6 billion with the company’s aerospace unit seeing a 4% increase in sales due to higher demand for drones and manned aircraft.

“Autonomous Systems sales rose due to higher volume on the Global Hawk and Triton programs, partially offset by lower volume due to the ramp down on the NATO Alliance Ground Surveillance program,” the company said in a statement.

“Manned Aircraft sales rose due to higher restricted volume and higher F-35 deliveries, partially offset by fewer F/A-18 deliveries and lower volume on the B-2 program.”

It should be noted that Lockheed Martin, is the prime contractor for the F-35 Lightning II, however, Northrop Grumman develops the fifth-generation fighter jets’ center fuselage, radar and avionics suite.

Northrop is also a subcontractor to Boeing on the F/A-18 Hornet.

Highlights from Northrop Grumman’s quarterly earnings report:

•Sales increase by 2% to $6 billion (compared to $5.9 billion in Q2 of 2015)

•Earning per share increase by 4% to $2.85

•Earning per share guidance increase to $10.75 to $11.00

•Cash from operations of $604 million

Raytheon

4 tips for buying your first home on active duty
A Patriot Air and Missile Defense launcher fires an interceptor during a previous test at White Sands Missile Range in New Mexico. The latest configuration of the system, called PDB-8, has passed four flight tests and is now with the U.S. Army for a final evaluation. | Raytheon

Raytheon, the world’s largest missile manufacturer, announced $6 billion in net sales for Q2 2016, which is up 3% compared to $5.8 billion in the second quarter 2015.

Earnings per share was $2.38 compared to $1.65, this time last year.

“We begin the second half of 2016 with continued confidence in our growth outlook, and we have increased our guidance for earnings and cash flow as a result of our strong year-to-date performance,” CEO and Chairman Thomas A. Kennedy said in a statement.

Highlights from Raytheon’s quarterly earnings report:

•Sales increase by 3% to $6 billion (compared to $5.8 billion in Q2 2015)

•Increase in operating cash flow to $746 million (compared to $376 million in Q2 2015)

•Backlog and funded backlog at the end of the Q2 2016 was $35.3 billion and $26.1 billion, respectively.

MIGHTY MONEY

Here’s a 9-step guide to calculating your credit card interest

When it comes to credit cards, understanding your interest rate and how it works can be the difference between staying out of debt with an excellent credit score and falling behind in your payments and dipping to sub-par credit score ratings.

Your interest rate is the amount your credit card charges you to borrow money. If you pay your credit card balance in full and on time, you generally don’t need to worry much about your interest rate, which is expressed as an annual percentage rate (APR).

But if you’re carrying a balance on your credit card, you’ll notice you owe more over time, and that’s because of the interest rate. Credit cards are notorious for being one of the most expensive types of consumer debt, with an average interest rate of about 17%.


While in most cases you probably don’t need to calculate your credit card card interest rate — your statements should clearly reflect how much interest is owed on any unpaid balance and your APR should be clear on your statement and your bank’s website — you may want to get an idea of how much your balance is costing you on a day-to-day basis.

4 tips for buying your first home on active duty

Here’s a quick cheat sheet to help you when it comes to calculating your own credit card interest rate.

1. Pull up your credit card information

Log on to your financial institution’s website or pull out your latest statement (if you haven’t switched to paperless billing yet, get on that!) to find the pertinent information you’ll need to calculate your credit card interest.

You’ll need to find:

  • your purchase APR
  • the number of days in your billing cycle

2. Get to know the terms

The way your credit card works boils down to a few different terms, two of which include annual percentage rate (APR) and, more generally, your interest rate.

Although APR stands for annual percentage rate, your credit card company uses this percentage number to determine the interest you’ll be charged each month when you don’t pay your credit card off in full and carry a balance.

Keep in mind that your credit card may have different types of APR, like a:

  • purchase APR (usually applied to the overall purchases you make with a card),
  • balance transfer APR (usually applied to any balances transferred from another credit card)
  • introductory APR (usually applied to purchases made during the promotional period after opening a new credit card)

3. Find your purchase APR

In order to calculate the interest you owe on any leftover balances on your credit card, you’ll need to find your purchase APR. If you can’t find this information readily, try calling your bank, or click on your card’s terms and conditions section.

4 tips for buying your first home on active duty

4. Determine your average daily balance (or balance subject to interest)

This is the aggregate total of what you spent and either paid off and/or were refunded every day throughout your billing cycle, divided by the number of days in your billing cycle.

If you’ve always paid your purchases in full by the due date, you won’t have any interest payments to make and your average daily balance isn’t really a factor. However, if you plan to carry a balance, to calculate your average daily balance when you need to determine interest, log onto your bank account online and track the charges and credits that went through on each individual day, creating a rolling total as you move through the days of your billing cycle.

This will provide you with an aggregate total that you can then divide by the number of days in your billing cycle (which you’ll find in step five).

5. Get the number of days in your billing cycle

Different credit cards have different amounts of time between billing cycles. A typical credit card statement is paid out in 30-day billing cycles.

6. Divide your APR by 365

Since your APR is your annual interest rate, you’ll need to divide your APR by the number of days in the year to get your daily interest rate. So for example, an APR of 13.99% would become: 0.1399/365 = .00038 daily interest.

7. Multiply your daily rate by your average daily balance

Once you know what you’re charged daily for interest, you can multiply that number by your average daily balance to find the daily interest you’ll owe. So for example, if your leftover balance after paying your credit card is id=”listicle-2639175991″,000, you would get: .00038 x id=”listicle-2639175991″,000 = .38.

4 tips for buying your first home on active duty

8. Multiply your daily interest rate by the number of days in your billing cycle

If you determined that you have a 30-day billing cycle, then the credit card interest you would owe on a balance for the 30-day cycle in this example would be: .38 x 30 days = .50 in interest.

9. Ask about your credit card’s grace period allowance

Some credit cards offer a grace period between when items are purchased and when they absolutely need to be paid off before accruing interest. Check in with your bank to learn if you have a grace period on your accounts and what the exact grace period is in order to better avoid paying interest.

Also read:

This article originally appeared on Business Insider. Follow @BusinessInsider on Twitter.

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The military pay raise for 2017 might be a bit underwhelming

The U.S. military has a reputation for being overworked and underpaid.


But we all knew that going in.

The virtue of service and pride of wearing the uniform makes up for much of the disparity in pay compared to the civilian market. Still, it’s nice to get that bump in our paychecks every year.

Yet, the pay increase for 2017 won’t be so big. In an August 2016 letter to Congress, President Obama announced a 1.6 percent raise for the armed forces, consistent with the budget he sent to The Hill earlier in the year.

4 tips for buying your first home on active duty
(White House photo)

Across-the-board pay increases for other federal employees will be 1 percent.

“These decisions will not materially affect our ability to attract and retain a well-qualified Federal workforce,” Obama said in his letter to Congress.

Pay raises for the military peaked in 1983 when President Reagan instituted a 14.3 percent pay raise. Since then, the increase hovered steadily between 3 and 5 percent, with an average of 4.2 percent, according to the Congressional Research Service.

4 tips for buying your first home on active duty
Military pay raises since 1977.

According to Military.com’s Brendan McGarry, the Senate backs the President’s proposed numbers, but the House of Representatives was looking for a 2.1 percent raise.

When Congress agrees on how much it will be, the military pay raise will go into effect on January 1, 2017.

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